Business
Business, 30.03.2020 17:36, carog24

Your firm currently has $ 100 million in debt outstanding with a 10 % interest rate. The terms of the loan require the firm to repay $ 25 million 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?

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