TLC Corp. has averaged net income of $25 million per year on net sales of $300 million per year. It currently has no long-term debt, but is considering a debt issue of $10 million. The interest rate on the debt would be 8 percent. The firm currently faces an effective tax rate of 25 percent. What would be the firm's savings on its taxable income (ATS) if it goes through with the debt issuance? If any financial distress costs, agency costs and signalling effects are ignored, what would be the increase in the firm's value as a result of this debt issuance? I New debt Interest Tax rate Interest expense Annual tax shields Increase in firm value ISSO