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A Firm Has Interest Expense of $3,500 Each Year for Ten

Question 90

Multiple Choice

A firm has interest expense of $3,500 each year for ten years. If the tax rate is 35% and the discount rate is 8%, compute the value of the interest rate tax shield.


A) $7,091
B) $7,514
C) $8,220
D) $8,716

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