1.Electric Company has $9,004,617 in permanent debt outstanding. The firm will pay interest only on this debt. The firm's marginal tax rate is expected to be 51% for the foreseeable future. Suppose that the firm pays interest of 5.14% per year on its debt.

What is the annual interest tax shield?

NOTE: Submit your answers with 4 decimals after the dot. Do not include the "$" sign

2.

Suppose the corporate tax rate for Electric Company is 45%. Consider a firm that earns $1038 before interest and taxes each year with no risk. The firms capital expenditures equal its depreciation expenses each year, and it will have no changes to its net working capital. The risk-free interest rate is 5.96%.

NOTE: Submit your answers with 4 decimals after the dot. Do not include the "$" sign

8. Suppose the corporate tax rate for Company A is 38%. Consider a firm that earns $1481 before interest and taxes each year with no risk. The firms capital expenditures equal its depreciation expenses each year, and it will have no changes to its net working capital. The risk-free interest rate is 3.54%.

Suppose the firm makes interest payments of $466 per year. What is the value of debt?

NOTE: Submit your answers with 4 decimals after the dot. Do not include the "$" sign