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Present value of interest tax shield

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Reference no: EM132131619

Assume that a firm could borrow 100 billion dollars. The most straightforward value from the leveraged recapitalization that people would estimate is the present value of interest tax shield. Assume the cost of debt is 0.298%(5 years to maturity). Corporate tax rate is 30.89%. what's the present value of interest tax shield?

Reference no: EM132131619

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