Compute the PV of the interest tax shields generated by the following three debt issues. In each case the debt is risk free while the corporate tax rate is 35%. a) A $1,000 one-year loan at the risk-free rate of 8%. b) A five-year loan of $1,000 at the risk-free rate of 8%. Assume interest is paid annually while the principal is paid back at maturity. c) A $1,000 debt perpetuity at the risk-free rate of 7%.

a. Present value of tax shield = $25.93

b. Present value of tax shield = $111.80

c. Tax shield = $350

Explanation:

a. Tax shield =  Loan * rate * tax rate

Tax shield = 1,000 * 8% * 35%

Tax shield = $28

Present value of tax shield = 28 / (1+8%)

Present value of tax shield = 28 / 1.08

Present value of tax shield = 25.92592593

Present value of tax shield = $25.93

b. Tax shield each year = 28

Present value of tax shield = 28 / (1+8%)^1 + 28 / (1+8%)^2 + 28 / (1+8%)^3 + 28 / (1+8%)^4 + 28 / (1+8%)^5

Present value of tax shield = 28/1.08  + 28/1.1664 + 28/1.25971 + 28/1.36049 + 28/1.46933

Present value of tax shield = 111.795875652

Present value of tax shield = $111.80

c. Tax shield = Perpetuity * tax rate

Tax shield = 1000 * 35%

Tax shield = $350

among other factors, composers started writing dynamic markings in their scores because "new instruments allowed for more dynamic ranges and contrast."

dynamics allude to the loudness or softness of music. dynamics offer an approach to demonstrate articulation in sheet music. they to drive the enthusiastic substance of music through volume and force. maybe you could alter both the volume and the shading profundity on your screen at the same time. we can likewise think about the force side of elements as the quality of a note. a few notes are intended to be played delicately and gently, while others are intended to be played all the more firmly.  

some dynamics markings have a letter 'm,' which remains for mezzo, signifying 'medium.' so a mezzo piano unique stamping resembles this (mp) and intends to play medium calm, while a mezzo specialty dynamic resembles this (mf) and intends to play medium loud.