Your firm currently has

$ 128$128

million in debt outstanding with a

10 %10%

interest rate. The terms of the loan require it to repay

$ 32$32

million of the balance each year. Suppose the marginal corporate tax rate is

30 %30%,

and that the interest tax shields have the same risk as the loan. What is the present value of the interest tax shields from this debt?

The present value of the interest tax shields is

$

million