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DLTuckers Has $21,000 of Debt Outstanding That Is Selling at Par

Question 41

Multiple Choice

D.L.Tuckers has $21,000 of debt outstanding that is selling at par and has a coupon rate of 7.5 percent.The tax rate is 32 percent.What is the present value of the tax shield?


A) $504
B) $615
C) $644
D) $6,200
E) $6,720

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