Explanation:

Modigliani and Miller demonstrate that, in the presence of corporate taxes (excluding personal taxes), the value of a levered company is higher than that of an all-equity company by an amount equal to the tax rate multiplied by the value of the debt. This is referred to as the debt tax shield.

• Option A is incorrect because the savings are not the value of the debt itself but the tax rate multiplied by the debt value.
• Option B is incorrect because it refers to the after-tax cost of debt, not the tax savings from the debt.
• Option C is correct as it accurately describes the debt tax shield effect.