Quiz – T/F: $0.50 out of every $1.00 of interest paid by a corporation

Fundamentals of Financial Management, Concise

Brigham and Houston

09th Edition and 10th Edition

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Determine whether the following is true or false:

Suppose that tax laws were changed such that $0.50 out of every $1.00 of interest paid by a company was allowed to be tax-deductible, then this would enourage corporations to use more debt financing than they currently do.

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