Use the Following Information to Answer the Question(s)below

question 55

Multiple Choice

Use the following information to answer the question(s) below.
Google Corporation has no debt on its balance sheet in 2008,but paid $1.6 billion in taxes.Assume that Google's marginal tax rate is 35% and Google's borrowing cost is 7%.
-Assume that investors hold Google stock in retirement accounts that are free from personal taxes.If Google were to issue sufficient debt to reduce its taxes by $1 billion per year permanently,then the value that would be created is closest to:

• A)$14.25 billion.
• B)$22.00 billion.
• C)$24.50 billion.
• D)$40.75 billion.

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Definitions:

First-Time Parenthood

The experience of becoming a parent for the first time, encompassing the challenges and adjustments faced in the new role.

Emerging Adults

Individuals in a life stage occurring roughly between the ages of 18 and 25, where they explore various aspects of identity and self-concept before making adult commitments.

Earlier Decades

Refers to years or periods of time that occurred in the past, often used to describe trends or conditions in history.

More Children

Refers to an increase in the number of offspring produced or being cared for.