The interest tax shield is equal

Assignment Help Financial Management

Reference no: EM132055984

1. The interest tax shield is equal to the:

A. difference between the interest expense and income taxes.

B. amount of interest paid in a given year.

C. product of the interest expense and the tax rate.

D. product of the debt principal and the interest rate on debt.

2. A project produced net operating profit after tax of $585,286 last year. depreciation expenses were 104,923, capital expenditures were $201,687 and net working capital increased by 48,723. what is the projects free cash flow?

A. 503, 883

B. 569,817

C. 524,522

D. 447,783

E. 439,799

3. A project requires an investment of $5,000 today and it is expected to generate after tax cash flows of $2,500 per year for next three years. The company’s weighted average cost of capital is 9.8% per year. What is the project’s internal rate of return?

A. 16.7%

B. 19.6%

C. 17.3%

D. 23.4%

E. 11.3%

Reference no: EM132055984

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