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8. Keys Printing plans to issue a $1,000 par value, 20-year noncallable bond with an 8.00% annual coupon, paid semiannually. The company's marginal tax rate
8. Keys Printing plans to issue a $1,000 par value, 20-year noncallable bond with an 8.00% annual coupon, paid semiannually. The company's marginal tax rate is 40.00%, but Congress is considering a change in the corporate tax rate to 30.00%. By how much would the component cost of debt used to calculate the WACC change if the new tax rate was adopted? *
8. Keys Printing plans to issue a $1,000 par value, 20-year noncallable bond with an 8.00% annual coupon, paid semiannually. The company's marginal tax rate is 40.00%, but Congress is considering a change in the corporate tax rate to 30.00%. By how much would the component cost of debt used to calculate the WACC change if the new tax rate was adopted? *
A. 0.57%
B. 0.63%
C. 0.70%
D. 0.77%
E. 0.80%
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