Company B is valued by the market at $1.9 billion. It has no debt outstanding. Company...

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Company B is valued by the market at $1.9 billion. It has no debt outstanding. Company C, which always will have the same distribution of cash flows as B, has risk-free debt worth $1 billion. The debt pays 4.8% annual interest, and the amount of debt will remain the same permanently. The expected earnings before interest (i.e., free cash flows) for each firm will be $0.2 billion each year forever. The Modigliani-Miller assumptions hold. a. What is the market value of Company C's equity? Report an answer in $ billions to two digits after the decimal. Company C's equity is worth $ billion. b. What is the cost of equity for each firm? Report a percentage with two digits after the decimal. Company B's cost of equity is%. Company C's cost of equity is%. c. What are the firms' weighted average costs of capital? Report with two digits after the decimal. The WACC for Company B is %. The WACC for Company C is %. Company B is valued by the market at $1.9 billion. It has no debt outstanding. Company C, which always will have the same distribution of cash flows as B, has risk-free debt worth $1 billion. The debt pays 4.8% annual interest, and the amount of debt will remain the same permanently. The expected earnings before interest (i.e., free cash flows) for each firm will be $0.2 billion each year forever. The Modigliani-Miller assumptions hold. a. What is the market value of Company C's equity? Report an answer in $ billions to two digits after the decimal. Company C's equity is worth $ billion. b. What is the cost of equity for each firm? Report a percentage with two digits after the decimal. Company B's cost of equity is%. Company C's cost of equity is%. c. What are the firms' weighted average costs of capital? Report with two digits after the decimal. The WACC for Company B is %. The WACC for Company C is %.