The Itsy Bitsy Toy Corp. is expected to develop a new product line and plans to raise money for additional external financing.In which of the following situation, the debt financing plan should be a better choice?

a)A recent tax proposal put forward by congressional Republicans would eliminate the tax deduction for net interest payments. Though it is unclear whether such a plan would become law and in what form, companies are betting that it could happen but that the interest on existing bonds would be exempted.

b)Management control is critical to the founder of the company.

c)The price-to-earnings (P/E) ratio of company has been significantly higher relative to peers.

d)None of the above