APV in Q2 Fubuki Dec 2010

Dear sir,

In the answer for Q2 Fubuki provided by BPP Rev Kit, they calculated the benefit of subsidy loan as: Value of loan x (i provided by government – i normal) x (1-tax rate). It is the same as provided by Kaplan text book. It means that the effect of lower tax shield reduces the benefit of lower interest loan.

However, in BPP text book and as I asked you before in a recent topic, the benefit is: Value of loan x (i provided by government – i normal).

So what solution is correct?

PS: just one more question about duration, I combined it here to save the space of forum.
In answer provided in BPP Rev Kit for question “AWP Co.”, the PV of each cash flow uses the YTM which is the IRR (Duration = Sum( t x PV (CFt) @ YTM )/ Bond price;t=[1,n])

However, I wonder if we can use the spot yield curve to discount PV of each cash flow to calculate duration, it would save a lot of time as the question has provided the curve! (Duration = Sum ( t x PV(CFt) @ spot of year t)/ Bond price).

I have tried both and the result is just slightly different.