Your frm is considering issuing one-year debt, and has come up with the following estimates of the value of the interest tax shield and the probability of distress for different levels of debt: Suppose the firm has a beta of zoro, so that the appropriate discount rate for financial distress costs is the risk-froe rate of 5%. Which level of debt above is optimal it, in the event of distress, the firm will have distress costs equal to b. $5 million? c. $22 million? a. $3 million? a $3 million? 11 distress costs are equal to $3 million, the optimal level of debt is smilion (Round to the nearest integer) - Data Table (Click on the following icon in order to copy its contents into a spreadshot.) Debt Level (in 9 million) 0 40 50 60 70 PV (interest tax shield, 5 million) 0,00 0.76 0.95 1.14 133 Probability of Financial Distress 0% 0% 1% 2% 7% 80 152 16% 90 1.71 31% Print Done