Pinder Co operates under the assumptions of Modigliani and Miller, with the only exception that there are corporate taxes of 40%. Pinder Co is considering issuing $800 million in perpetual corporate bonds with an interest rate of 5%, and using those proceeds to repurchase shares. If Pinder Co goes through with this plan, how much would the value of Pinder Co as a whole increase by?

a)$280 million

b)$310 million

c)$340 million

d)None of the other answers are correct.

e)$370 million