Solve the problem using an easy to understand approach

Monty is an all-equity financed company with a cost of equity of 15%. 35 The directors of Monty are proposing to raise $20 million to invest in a new project. This investment will carry similar risk to Monty's current business. It is proposed that the investment will be financed by either a rights issue of shares, or an issue of an undated bond carrying 6% interest pre-tax (this rate is deemed to reflect the returns required by the market for the risk and duration of the bond). Earnings for Monty are forecast to be $30 million in the first year after the new investment. Subsequently, earnings are expected to remain at a constant level each year. The corporate income tax rate is 20%. This is not expected to change. According to Modigliani and Miller's theory with tax, the value of Monty's EQUITY if it issues the bond and undertakes this project will be: A $204 million B $200 million C. $184 million D $180 million