a$.$ What is the relative tax advantage of corporate debt if the corporate tax rate is $T_c=0\mathrm{.}24,$ the personal tax rate on interest is

$T_{pD}=0\mathrm{.}32,$ but all equity income is received as capital gains and escapes tax entirely $(T_{pE}=0)?$

b$.$ How does the relative tax advantage change if the company decides to pay out all equity income as cash dividends that are

taxed at $34\%?$

Note: Do not round intermediate calculations. Round your answers to $4$ decimal places.

Answer is complete but not entirely correct.What is the relative tax advantage of corporate debt if the corporate tax rate is Tc$=0\mathrm{.}24$

$,$ the personal tax rate on interest is TpD$=0\mathrm{.}32$

$,$ but all equity income is received as capital gains and escapes tax entirely $($ TpE$=0$

$)?$

How does the relative tax advantage change if the company decides to pay out all equity income as cash dividends that are taxed at $34\%?$

Note: Do not round intermediate calculations. Round your answers to $4$ decimal places.