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Suppose that LilyMac Photography expects EBIT to be approximately $220,000 per year for the foreseeable future, and that it has 1,000 10-year, 9 percent annual

Suppose that LilyMac Photography expects EBIT to be approximately $220,000 per year for the foreseeable future, and that it has 1,000 10-year, 9 percent annual coupon bonds outstanding. (UseTable 11.1)

What would the appropriate tax rate be for use in the calculation of the debt component of LilyMac's WACC?

Tax rate

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