Two clonts (investors X and Y ) are considering two firms, X Inc and Spector Corp, both with ES0,000 in assets. X ine is un-leverod, and Spector Corp has D20,000 of debt that pays 8% interest. X Inc has 1,000 shares outstanding, while Spector Corp has 600 shares outstanding. Investor X owns 20% of Spector Corp and belevies that leverago worke in his favour. Investor Y beligves investor X 's decision is not financially accurate, and that with the possibitity of borrowing on her own account at B\% interest, she can replicate investor X5 payout from Spector Corp. They both seek your opinion on their above strategies. Answer the following quastions: a) Given a kovol of operating income of 22,500 , show whether investor Xs strategy is better than Investor Y. (5) b) Atter seeing investor Y's analybi, tmestor X tells investor Y that while her analysis looks good on paper, Inweator Y will never be able to borrow at BY, but would have to pay a more realistic rate of 12%, If Invistor X is right, what will investor Y 's payout be? (5) c) Comment on the theoretic rationale behind these calculatione. (3)