The CFO of Will Industries plans to have the company issue $500 million of new 10% coupon bonds and use the proceeds to buy back their undervalued stock. Assume that the company, which does not pay any dividends, takes this action, and that total assets, operating income (EBIT), and its tax rate all remain constant. Which of the following would occur?

a. The company's taxable income would rise

b. The company would have more common equity than before

c. The company's risk would decrease

d. The company would have to pay less in taxes