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1. (6 points) BAT Inc. has a $1,000 (face value), 20 year bond issue selling for $829.73 that pays an annual coupon of 8.0

1. (6 points) BAT Inc. has a $1,000 (face value), 20 year bond issue selling for $829.73 that pays an annual coupon of 8.0 percent. Their marginal tax rate is 25%. a. What would be BAT's current before-tax component cost of debt? a. What would be BAT's current after-tax component cost of debt?

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