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Apple computers has no debt. As problem 21 in chapter 15 makes clear, by issuing debt, Apple can generate a very large tax shield partially
Apple computers has no debt. As problem 21 in chapter 15 makes clear, by issuing debt, Apple can generate a very large tax shield partially worth $10 billion. Given Apple's success, one would be hard pressed to argue that Apple's management are naive and unaware of this huge potential to create value. A mere likely explanation is that issuing debt would entail other cost. What might this cost be?
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