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13. (Cost of Debt) The Zephyr Corporation is contemplating a new investment to be financed with 40 percent from debt. The firm could sell new
13. (Cost of Debt) The Zephyr Corporation is contemplating a new investment to be financed with 40 percent from debt. The firm could sell new Rs1,000 par value bonds at a net price of Rs 935. The coupon interest rate is 11 percent, and the bonds would mature in 12 years. If the company is in 40 percent tax bracket, what is the after tax cost of capital to Zephyr for bonds
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