Question
Bay Transport Systems (BTS) currently has $ 25 million in debt outstanding. In addition to 7.0 % interest, it plans to repay 10 % of
Bay Transport Systems (BTS) currently has $ 25 million in debt outstanding. In addition to 7.0 % interest, it plans to repay 10 % of the remaining balance each year. If BTS has a marginal corporate tax rate of 21 % and if the interest tax shields have the same risk as the loan, what is the present value of the interest tax shield from the debt?
(Round to two decimal places.)
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The Changing Geography Of Banking And Finance
Authors: Pietro Alessandrini ,Michele Fratianni ,Alberto Zazzaro
1st Edition
1441947205, 978-1441947208
