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Question 16 0 / 1 point A firm with no outstanding debt is considering borrowing E35m and buying back E35m worth of stock. The annual interest rate on the debt would be 8% and the debt would be paid back after 12 years. The firm currently has a net operating loss of E8m, and it is estimated that it will be 4 years before the interest paid on the debt could be used to shield profits from taxation (at which point there would be enough profit to fully avail of the interest tax shield). If the firm faces a marginal tax rate of 30%, the present value of the tax shield associated with the debt is closest to: A) E5.75m x . B) E6.50m - c) E5.25m (D) E7.25m Question 17