12) Nico Trading Corporation is considering issuing long-term debt. The debt would have a 30-year maturity and a 10 percent annual coupon rate. In order to sell the issue, the firm's $1,000 par value bonds must be underpriced and sold at $950. In addition, the firm would have to pay flotation or issuance costs of 5 percent of the par value. The firm's corporate tax rate is 30 percent. Given this information, the after-tax cost of debt for Nico Trading would be a) 7.26% b) 11.17% c) 7.82% d) 7.39% 13) Tangshan Mining is considering issuing long-term debt. The debt would have 30 years to maturity and a 12 percent annual coupon rate, with coupon payments paid semi-annually. In order to sell the issue, the $1,000 par value bonds must be sold at a discount of 2.5 percent of the par value. In addition, the firm would have to pay flotation or issuance costs of 2.5 percent of the par value. The firm's corporate tax rate is 20 percent. Given this information, the after-tax cost of debt for Tangshan Mining would be a) 12.65% b) 6.32% c) 3.79% d) 5.06% 14) A firm has determined that it can issue preferred stock at $100 par value per share. The stock will pay a $12 annual dividend. The cost of issuing and selling the stock is $5 per share. Hence, the cost of the preferred stock financing for the firm is a) 5.26 percent b) 12.63 percent. c) 0.13 percent. d) 12 percent