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PMF, Inc, can desuct inhorest expenses neat year up to 30% of Eert. This limt is oqually lkely to be 13 melion, $10 milion, or

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PMF, Inc, can desuct inhorest expenses neat year up to 30% of Eert. This limt is oqually lkely to be 13 melion, $10 milion, or $17 malion, its oorponate tax nate is 35% and investors pay a 10% tax rave on income from equily and a 32% tax rate on interest inoome. a. What is the eflective tax advartage of debe if PME has interest experses of 32 milion this coming year? B. What is the effectve tax astantage of debt for interest expenses in excess of $17 millon? (ggoce carrylorwards). c. What is the expected effective tax acvantage of debt for interest expenses between $3 millon and $10 millon? (ignore carryforwards). d. What ievel of interest expense provises PMF with the graatest tax benelt

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