Use the Information for the Question(s)below

question 60

Multiple Choice

Use the information for the question(s) below.
Aardvark Industries is considering a project that will generate the following free cash flows: You are also provided with the following market value balance sheet and information regarding Aardvark's cost of capital:
-Suppose that to fund this new project,Aardvark borrows $120 with the principal to be paid in three equal installments at the end each year.The present value of Aardvark's interest tax shield is closest to:

• A)$5.15.
• B)$5.00.
• C)$5.90.
• D)$5.25.

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Definitions:

Learning Sets

The concept in psychology that refers to the ability to learn how to learn; the process by which one becomes more efficient at acquiring new skills or knowledge through experience.

Hypnosis

A trance-like state of focused attention and heightened suggestibility, often used for therapeutic purposes.

Psychoanalytic Theorist

A professional in psychology who employs psychoanalytic theories that focus on unconscious processes affecting human behavior.

Franz Mesmer

An 18th-century German physician who developed a theory of animal magnetism and is considered a pioneer in the study of hypnosis.