Smith's HVAC has several capital budgeting projects from which to choose. The problem is that it has more of these projects than it can finance without issuing new stock and the board of directors refuses to issue any new shares in the foreseeable future. Smith's projected net income is $125.0 million, its target capital structure is 30% debt and 70% equity, and its target payout ratio is 60%. The CFO now wants to determine how the maximum capital budget would be affected by changes in capital structure policy and/or the target dividend payout policy. Versus the current policy, how much larger could the capital budget be if (1) the target debt ratio were raised to 65%, other things held constant, (2) the target payout ratio were lowered to 45%, other things held constant, and (3) the debt ratio and payout were both changed by the indicated amounts.