eBook Problem Walk Through Tax Shield Value Wilde Software Development has a 10 unlevered cost of equity Wilde forecasts the following interest expenses, which are expected to grow at a constant 3 rate after Year 3 Wilde's tax rate is 25 Year 1 Year 2 Year 3 Interest expenses $90 $105 $150 What is the horizon value of the interest tax shield Do not round intermediate calculations Round your answer to the nearest cent $ What is the total value of the interest tax shield at Year 0 Do not round intermediate calculations Round your answer to the nearest cent $

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Question: eBook Problem Walk-Through Tax Shield Value Wilde Software Development has a 10% unlevered cost of equity. Wilde forecasts the following interest expenses, which are expected

eBook Problem Walk-Through

Tax Shield Value

Wilde Software Development has a 10% unlevered cost of equity. Wilde forecasts the following interest expenses, which are expected to grow at a constant 3% rate after Year 3. Wilde's tax rate is 25%.

	Year 1	Year 2	Year 3
Interest expenses	$90	$105	$150

What is the horizon value of the interest tax shield? Do not round intermediate calculations. Round your answer to the nearest cent.

$
What is the total value of the interest tax shield at Year 0? Do not round intermediate calculations. Round your answer to the nearest cent.

$

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