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Consider the Following Formula

Question 32

Multiple Choice

Consider the following formula:
VL = VU + Consider the following formula: V<sub>L</sub> = V<sub>U</sub> + The term Represents: A) the value of the firm with leverage. B) the present value of the interest tax shield. C) the preset value of the future interest payments. D) the interest tax shield each year.
The term Consider the following formula: V<sub>L</sub> = V<sub>U</sub> + The term Represents: A) the value of the firm with leverage. B) the present value of the interest tax shield. C) the preset value of the future interest payments. D) the interest tax shield each year.
Represents:


A) the value of the firm with leverage.
B) the present value of the interest tax shield.
C) the preset value of the future interest payments.
D) the interest tax shield each year.

Correct Answer:

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