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14 A firm sold a 10-year bond issue 3 years ago. The bond has a 6 45% annual coupon and a $1,000 foco value. If
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A firm sold a 10-year bond issue 3 years ago. The bond has a 6 45% annual coupon and a $1,000 foco value. If the current market price of the bond is $1,000 (the bond is selling for its face or par value) and the tax rate is 40%, what is the after-tax cost of debt? [Hint: Recall that the after-tax cost of debt = before-tax cost times (1 - tax rate). O 3.87% 04.19% O 4.95% 0 4.41% O 4.78% Step by Step Solution
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