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1. * Several years ago, LAC Company sold a $1,000 par value, noncallable bond that now has 10 years to maturity and a 7.00% annual

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1. * Several years ago, LAC Company sold a $1,000 par value, noncallable bond that now has 10 years to maturity and a 7.00% annual coupon that is paid annually. The bond currently sells for $900, and the company's tax rate is 40%. What is the after-tax component cost of debt for use in the WACC calculation? Choose one of the following answers. 5.12% O 7% O 8.53%

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