Multiple Choice
Your firm has a bond issue with a face value of $250,000 outstanding.These bonds have a coupon rate of 7 percent,pay interest semiannually,and have a current market price equal to 103 percent of face value.What is the amount of the annual tax shield on debt given a tax rate of 21 percent?
A) $3,675
B) $6,309
C) $4,500
D) $47,500
E) $52,500
Correct Answer:
Verified
Correct Answer:
Verified
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