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can I get the answers with explaining how to get the numbers? I would prefer if you do it on a paper. b. A five-year
can I get the answers with explaining how to get the numbers? I would prefer if you do it on a paper.
b. A five-year loan of at 8%. C. A $1,000 perpetuity at 7%. $ 1,000 Assume no principal is repaid until maturity. 13. Tax shields Suppose that Congress sets the top personal tax rate on interest and dividends at 35% and the top rate on realized capital gains at 15%. The corporate tax rate stays at 35%. Compute the difference between the total corporate plus personal taxes paid on debt and the total taxes on equity income if (a) all capital gains are realized immediately and (b) capital gains are deferred forever. Assume capital gains are half of equity incomeStep by Step Solution
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