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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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