How much tax is avoided by using the level of debt financing


Discussion Post: Discount Cash Flow Valuation

• Perform a DCF valuation of MW as of 2016 using the template given. Assume 500,000 in equity and a 5% cost of debt if the balance of deal is financed with debt. Assume a 9%WACC. Finally, assume that TV is 10.5 times year7 EBIT.

• How much tax is avoided by using the level of debt financing in the deal?

• What would be your valuation if operating margin remains at 57.4% throughout the forecast period?

• What would you offer for the practice?

The response must include a reference list. One-inch margins, double-space, Using Times New Roman 12 pnt font and APA style of writing and citations.

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Financial Management: How much tax is avoided by using the level of debt financing
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