Question 5 1 pts ABC Corp. expects to have $50 in annual earnings before interest...
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Question 5 1 pts ABC Corp. expects to have $50 in annual earnings before interest and taxes, $200 in debt with an interest rate of 10%, and faces a corporate tax rate of 21%. If ABC were to increase its debt level to $300 what would be the increase in ABC's annual tax shield from interest? Assume that ABC's interest rate will not change. Round your final answer to two decimals. Question 6 1 pts ABC Corp. expects to have $50 in annual earnings before interest and taxes. ABC's current policy is to maintain a debt level of $200 perpetually. ABC's debt carries an interest rate of 10% and ABC has a corporate tax rate of 21%. What would be the increase in the present value of ABC's interest tax shields if were to increase its debt level to $300 perpetually. Assume that ABC's interest rate and tax rate will not change. Round your final answer to two decimals
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