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You own all the equity of Tech Tools Co. The company has no debt. The companys annual earning are $20,000, before interest and taxes. The
You own all the equity of Tech Tools Co. The company has no debt. The companys annual earning are $20,000, before interest and taxes. The corporate tax rate is 35%. You have the option to exchange part of your equity position for 4% loan with a face value of $100,000. Should you do this? Explain your answer.
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