You have been assigned as an analyst for Famous Ltd which is an all-equity firm. Its total market value is $7,500,000. There are 250,000 shares outstanding. The company announces a program to issue $2 million worth of bonds at 10% interest and to use the proceeds to buy back a portion of its ordinary shares. What is the value of the tax shield that the company acquires through the bond issue according to Modigliani & Miller? The company is subject to a 30 per cent tax rate.