Consider the Following Formula: Rwacc = RE

question 72

Multiple Choice

Consider the following formula: rwacc = rE + rD - rDτc
The term rDτc represents:

• A)the reduction due to the interest tax shield.
• B)the present value of the interest tax shield.
• C)the present value of the future interest payments.
• D)the interest tax shield each year.

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Definitions:

Rehabilitation Act

United States legislation aimed at protecting individuals with disabilities from discrimination in programs receiving federal financial assistance, enacted in 1973.

Discrimination

Unjust or prejudicial treatment of different categories of people, especially on the grounds of race, age, sex, or disability, leading to inequality and social tension.