Taro Inc. is currently an all equity firm that has 120,000 shares of stock outstanding at a market price of $34.50 a share. The cost of equity is 11% and the tax rate is 35%. Taro is considering adding $1.6 million of debt at an interest rate of 7.5% to the capital structure. What is the value of equity for the levered firm? Multiple Choice $31 million $3.9 million $2.8 million $47 million $4.3 million