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What amount should they borrow for the desired tax shield

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Question 1 - A company is trying to use a tax-shield for their capital structure strategy. The annual loan interest rate available to them is 9.52% and the marginal tax rate is 21%. What amount should they borrow for the desired $100,000 tax shield?

Question 2 - A company is trying to use a tax-shield for their capital structure strategy. The annual loan interest rate available to them is 9.52% and the marginal tax rate is 21%. What amount should they borrow for the desired $100,000 tax shield?

Reference no: EM133131079

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