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Q. |
What is the value of the tax shield if the value of the firm is $5 million, its value if unlevered would be $4.78 million, and the present value of bankruptcy and agency costs is $360,000? |
A. | $140,000 |
B. | $220,000 |
C. | $360,000 |
D. | $580,000 |
Answer» D. $580,000 |
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