Rappaport Industries has 5,350 perpetual bonds outstanding with a face value of $2,000 each. The bonds have a coupon rate of 6.6 percent and a yield to maturity of 6.9 percent. The tax rate is 21 percent. What is the present value of the interest tax shield?

Multiple Choice

$3,274,200

$251,022

$240,108

$2,247,000

$706,200