If a Firm Borrows $50 Million for One Year at an Interest

question 34

Multiple Choice

If a firm borrows $50 million for one year at an interest rate of 10%,what is the present value of the interest tax shield? Assume a 30% marginal corporate tax rate.

• A)$1.36 million
• B)$1.50 million
• C)$1.00 million
• D)$4.55 million

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Asynchronous

Communication or processes that do not occur in real-time and can be accessed or responded to at different times by different individuals.

Hybrid Teams

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Information Sharing

The exchange of data, knowledge, or information among individuals, organizations, or systems.