Your firm currently has 100 million in debt outstanding, Ask an Expert

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Your firm currently has $100 million in debt outstanding with a 9% interest rate. The terms of the loan require the firm to repay $25million of the balance each year. Suppose that the marginal corporate tax rate is 40%, and that the interest tax shields have the same risk as the loan. What is the present value of the interest tax shields from this debt?

Round to two the nearest cent.

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Financial Management, Finance

Category:- Financial Management
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