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Pack-and-Send, Inc. expects to have free cash flow of $5.75 million next year and this cash flow will grow at a rate of
Posted: Wed Mar 09, 2022 8:47 am
by answerhappygod
- Pack And Send Inc Expects To Have Free Cash Flow Of 5 75 Million Next Year And This Cash Flow Will Grow At A Rate Of 1 (29.82 KiB) Viewed 58 times
Pack-and-Send, Inc. expects to have free cash flow of $5.75 million next year and this cash flow will grow at a rate of 5% per year thereafter. The firm's equity cost of capital is 9% and its debt cost of capital is 4%. Assume that Pack-and-Send has a corporate tax rate of 25%. If the firm maintains a debt-to-equity ratio of 0.40, the value of the firm's tax shield is closest to: $18.47 million $27.95 million $54.28 million $260.00 million None of the above