Wednesday, 12 February 2020

A company’s value is 100 million euros (equity 50 and debt 50), and it decides to issue 20

A company’s value is 100 million euros (equity 50 and debt 50), and it decides to issue 20 million in debt to finance new investments. If the corporate tax rate is 30%, and the interests and dividends are taxed at the personal level at the same new company value (V), equity value (E) and debt value (D)?

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