hard20 pts · first answer countsvaluationdcftax

Which tax rate in a DCF

A company pays a 15% effective tax rate today thanks to incentives that end in four years; its marginal rate is 25%. How should the DCF treat tax?

A.15% while incentives last, then 25%; 25% for the debt shieldB.Use 15% for every year, including the terminal valueC.Use 25% in every year, ignoring the tax incentivesD.Use the average of 15% and 25% in every single year

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Which tax rate in a DCF

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