QUESTION 13 4 point Dahl Company can borrow funds at 15% interest. Since the company's tax rate is 40%, its after-tax cost of interest is only 9%Thus, the company reasons that if it can eam $70,000 per year before interest and taxes on a new investment of $500,000, then it will be better off by 325,000 per year. The company's reasoning is correct. The company's reasoning is not correct, since the after tax cost of interest would be 6 percent, rather than 9. The company's reasoning is not correct, since interest is not tax-deductible The company's reasoning is not correct, since it would be worse off by $3,000 per year after taxes