Question
Your firm has a $250,000 bond issue outstanding. These bonds have a 7% coupon, pay interest annually, and have a current market price equal to
Your firm has a $250,000 bond issue outstanding. These bonds have a 7% coupon, pay interest annually, and have a current market price equal to 103% of face value. What is the amount of the annual interest tax shield given a tax rate of 35%?
| A. | $6,125 | |
| B. | $6,309 | |
| C. | $9,500 | |
| D. | $17,500 | |
| E. | $18,025 |
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The Handbook Of Fixed Income Securities
Authors: Frank Fabozzi, Steven Mann
8th Edition
0071768467, 978-0071768467
