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Find What is the interest tax shield from Braxton debt

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Reference no: EM132912863

Problem 1: Braxton Enterprises currently has debt outstanding of $10 million and an interest rate of 9%. Braxton plans to reduce its debt by repaying $2 million in principal at the end of each year for the next five years. If Braxton's marginal corporate tax rate is 35%, what is the interest tax shield from Braxton's debt in each of the next five years?

Reference no: EM132912863

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