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A firm is generating $ 5 , 0 0 0 of EBIT every year. Tax rate is 3 0 % . The amount of debt

A firm is generating $

5, 000

of EBIT every year. Tax rate is

30 % .

The amount of debt of the firm is $

6, 000,

and its interest rate is

8 % .

What is the present value of annual interest tax shield?

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