Multiple Choice
Southern Fried Foods has a $12 million bond issue outstanding with a coupon rate of 6.75 per cent and a yield-to-maturity of 7.27 per cent.What is the present value of the tax shield if the tax rate is 35 per cent?
A) $283 500
B) $3 053 400
C) $3 560 000
D) $305 340
E) $4 200 000
Correct Answer:
Verified
Correct Answer:
Verified
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