What is the annual tax shield to a firm that has total assets of $80 million and a net worth of $55 million, if the average interest rate on debt is 8.5%, the average return on equity is 14%, and the marginal tax rate is 35%?
A) $2.125 million
B) $1.87 million
C) $0.85 million
D) $0.744 million
D
Business
You might also like to view...
If a firm's balance sheet has an equal amount of exposed foreign currency assets and liabilities and the firm translates by the temporal method, then:
A) the net exposed position is called monetary balance. B) the change is value of liabilities and assets due to a change in exchange rates will be of equal but opposite direction. C) Both A and B are true. D) none of the above
Business
The concept of "multigenerational diversity" has gained increasing recognition as a workplace issue
Indicate whether this statement is true or false.
Business