Question
Question 13 (1 point) A project lasts two years. The initial cost is $ 1,000,000 and the expected cash flow is $ 1,210,000. The cost
Question 13 (1 point)
A project lasts two years. The initial cost is $ 1,000,000 and the expected cash flow is $ 1,210,000. The cost of debt RD = 8% and the corporate tax rate is assumed to be 50%. Calculate the present value of the tax savings from interest on debt if the business borrows 50% of the initial investment.
Options for question 13:
$ 18,518.51852
$ 48,518.51852
$ 25,352.23632
$ 35,665.29492
$ 51,245.45452
Question 14 (0.5 points)
According to Rajan and Zingales (1995), the debt ratios of large companies seemed to depend on 4 major factors. One of these factors is:
Options for question 14:
The country in which the company operates
none of these answers
The company's intangible assets
The direct reputation of company executives
The liabilities of the company
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