A firm is analyzing two possible capital structures: 30 and 50 percent debt-to-assets ratios. The firm has total assets of $5,000,000 and common stock valued at $50 per share. The firm has a marginal tax rate of 40 percent on ordinary income. If the interest rate on debt is 7 percent and 9 percent for the 30 percent and the 50 percent debt ratios, respectively, the amount of interest on the debt under each of the capital structures being considered would be

	Plan 1	Plan 2
D/A ratio	30%	50%
Total Assets	$5,000,000	$5,000,000
Interst rate	7%	9%
Interest Amount