Given the following information for a levered and unlevered firm, calculate the difference in the cash flow available to investors. Assume the corporate tax rate is 40 percent.
(Hint: Calculate the tax savings arising from the tax deductibility of interest payments).

Levered Unlevered
Revenue $ 250 $ 250
Operating cost −$ 100 −$ 100
Interest expense −$ 20 $ 0

a.$18
b.$78
c.$8
d.$90