Your companys optimal (and current) capital structure is 50 percent equity and 50 percent debt. Its earnings before interest and taxes (EBIT) are projected to be $34.667 million for the year. The company has $200 million of assets; its average interest rate on outstanding debt is 10 percent; and its tax rate is 40 percent. How much interest will the company pay on the existing debt?

Question 8 options:

	$6 million
	$10 million
	$4 million
	$8 million