A company used to have zero debt and just issued $100,000 of perpetual debt and used the proceeds repurchase stock. The firm's the tax rate is 40%. Without the bankruptcy costs, what is the PV of the intervent tax shields? MM Theorem I with taxes: V-Vu+ TcB $50,000 $30,000 $40,000 $20,000

A company used to have zero debt and just issued $100,000 of perpetual detr rod wod the nowh sy tax shields? MM Theorem I with taxes: VL=VU+TCB $50,000 $30,000 $40,000 $20,000