Apple computers has no debt.
January 3rd, 2018
Apple computers has no debt. As problem 21 in chapter 15 makes clear, by issuing debt, Apple can generate a very large tax shield partially worth $10 billion. Given Apple’s success, one would be hard pressed to argue that Apple’s management are naive and unaware of this huge potential to create value. A mere likely explanation is that issuing debt would entail other cost. What might this cost be?