Solution-Present value of the interest tax shield

Present value of the interest tax shield

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Reference no: EM133111825

Your firm has a perpetually growing unlevered cash flow equal to 430,000. The growth rate is 2.00%. The firm keeps a constant debt-to-equity ratio equal to 26%. The interest rate on debt is 3.50%. If the unlevered return on equity is 8.25% and the tax rate is 36%, what is the present value of the interest tax shield?

Reference no: EM133111825

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Present value of the interest tax shield

Reference no: EM133111825

Reference no: EM133111825

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