What is amount of the annual interest tax shield

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Your firm has a $300,000 bond issue outstanding. These bonds have a 7% coupon, pay interest semiannually, and have a current market price equal to 103% of face value. What is the amount of the annual interest tax shield given a tax rate of 35%?

a. $7,350

b. $18,025

c. $6,125

d. $6,309

e. $17,500

Reference no: EM131526617

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