Financing Rule 2 ties the level of future interest tax shields to the future value of the

Question:

Financing Rule 2 ties the level of future interest tax shields to the future value of the project or company. That means the interest tax shields are risky and worth less than if the company followed Financing Rule 1. Does that mean that Financing Rule 1 is better for stockholders?

Future Value
Future value (FV) is the value of a current asset at a future date based on an assumed rate of growth. The future value (FV) is important to investors and financial planners as they use it to estimate how much an investment made today will be worth...