Transcribed Image Text
Krypton Engineering expects to have net profit next year of $16.01 million and free cash flow of $ 22.36 million. ? Krypton'smarginal corporate tax rate is 40 %. a. If Krypton increasesleverage so that its interest expense rises by $ 4.8 ?million, howwill its net profit? change? b. For the same increase in interest?expense, how will free cash flow? change?