A company is considering two financing options. Calculate the tax shield knowing that corporate tax rate is 25%

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answerhappygod
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A company is considering two financing options. Calculate the tax shield knowing that corporate tax rate is 25%

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A company is considering two financing options. Calculate the tax
shield knowing that corporate tax rate is 25%













Unleveraged K structue

Leveraged K structure



Bonds



675,000


Interest
rate


4%



EBIT

4,956,000

3,640,050
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