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- - 1. COST OF DEBT: FV = 1,000; coupon rate (CR) = 6%; maturity (N) = 10 years; current price (PO) = 950; tax

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- - 1. COST OF DEBT: FV = 1,000; coupon rate (CR) = 6%; maturity (N) = 10 years; current price (PO) = 950; tax rate (T) = 25%. Semi-annual interest payment. Calculate cost of debt (rp). Also, calculate after-tax cost of debt, ro(1-T). 2. COST OF EQUITY: Cost of debt (ro) = 10%; risk premium (RP) = 6%. Calculate cost of common equity (re). =

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