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RK Enterprises expected to have a dividend in the coming year of 8 million, and this dividend flow is expected to grow at a rate
RK Enterprises expected to have a dividend in the coming year of 8 million, and this dividend flow is expected to grow at a rate of 3% per year thereafter. RK Enterprises has an equity cost of capital of 13% a debt cost of capital of 7%, and it is in the 21% corporate tax bracket. Assume RK Enterprises maintains a .8 debt to equity ratio. Determine the value of RK Enterprisess interest tax shield. Please show all work. Upvotes will be given to correct answer!
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