The ARD business has a market value of equity of $850M and $250M of debt in market value. The bond of the firm ARD is rated A-. The tax rate is 35% and the cost of bankruptcy is 28% of the value of the business (equity and debt). bond rating Probability of Default by Bond Rating default profitability D CC CCC B- B B+ BB BBB A- A A+ AA AAA 100% 80% 65% 46,61% 32,50% 26,36% 19,28% 12,20% 2,30% 1,41% 0,53% 0,40% 0,28% 0,01% Suppose you are considering using the Adjusted Value Approach (APV) to assess the effect of leverage on the value of the ARD firm. at. Estimate the present value of the ARD business tax savings from current debt? (3 points). b. Estimate the expected cost of bankruptcy of the ARD company? (3 points). vs. Estimate the value of the ARD business without debt? (1 mark). The ARD business has a market value of equity of $850M and $250M of debt in market value. The bond of the firm ARD is rated A-. The tax rate is 35% and the cost of bankruptcy is 28% of the value of the business (equity and debt). bond rating Probability of Default by Bond Rating default profitability D CC CCC B- B B+ BB BBB A- A A+ AA AAA 100% 80% 65% 46,61% 32,50% 26,36% 19,28% 12,20% 2,30% 1,41% 0,53% 0,40% 0,28% 0,01% Suppose you are considering using the Adjusted Value Approach (APV) to assess the effect of leverage on the value of the ARD firm. at. Estimate the present value of the ARD business tax savings from current debt? (3 points). b. Estimate the expected cost of bankruptcy of the ARD company? (3 points). vs. Estimate the value of the ARD business without debt? (1 mark)