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Suppose firm XYZ borrows 60 million for one year at an interest rate of 7 percent, what is the present value of the interest tax

Suppose firm XYZ borrows 60 million for one year at an interest rate of 7 percent, what is the present value of the interest tax shield? Assume a 21 percent marginal corporate tax rate.

options:

a)12.6 million

b)17.50 million

c)1.04 million

d)0.82 million

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