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Wilde Software Development has a 13% unleveraged cost of equity. Wilde forecasts the following interest expenses, which are expected to grow at a constant 2%

Wilde Software Development has a 13% unleveraged cost of equity. Wilde forecasts the following interest expenses, which are expected to grow at a constant 2% rate after Year 3. Wilde's tax rate is 25%.

Year 1 Year 2 Year 3
Interest expenses $75 $100 $120

  1. What is the horizon value of the interest tax shield? Do not round intermediate calculations. Round your answer to the nearest cent.

    $ (I got 286.36)

  2. What is the total value of the interest tax shield at Year 0? Do not round intermediate calculations. Round your answer to the nearest cent.

    $ (This is the problem I keep having an issue with.)

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