Question 29 The interest tax shield is a key reason why (Ch 14) firms tend to minimize their borrowing. firms prefer equity financing over debt financing. the net cost of debt to a firm is generally less than the cost of equity. the value of an unlevered firm is equal to the value of a levered firm. 1P Question 30 The interest tax shield is a key reason why (Ch 14) the value of an unlevered firm is equal to the value of a levered firm. the net cost of debt to a firm is generally less than the cost of equity. firms tend to minimize their borrowing. firms prefer equity financing over debt financing