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Hello,if the exam question ask about the “what is the tax rate change will make the NPV equal to zero?”
assuming the NpV of the question is $1215,000 and tax rate is 30%
Is it the only method will work which calculates the new tax benefit in the NPV calculation by trial and error? is there has another approach?
Thank you.It depends on the rest of the information in the question (e.g. are there capital allowances, and if so on what basis are they calculated) – what you have typed is not enough to be able to calculate the tax rate.
If you are referring to a past exam question or a question in the current edition of the BPP Revision Kit, then tell me which question and then I will be able to answer properly.
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