The Interest Tax Shield Has No Value for a Firm

question 126

True/False

The interest tax shield has no value for a firm when a firm elects 100% equity as its capital structure.

---

Definitions:

Hot Springs

Natural pools of water that are heated geothermally from the Earth's interior, often found in volcanic areas.

Geothermal Power

The generation of electricity using the heat from within the Earth's crust, often harnessed at volcanic or tectonic plate boundaries.

Earthquakes

Vibrations of the Earth's surface caused by the sudden release of energy in the Earth's crust.

Uncertainty

Being in a situation where knowledge is constrained, preventing accurate depiction of the present condition, foreseeing an upcoming result, or determining various possible results.