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a) (1 mark) What is the after-tax discount rate that should be used in your calculations? b) (1 mark) What is the call premium
a) (1 mark) What is the after-tax discount rate that should be used in your calculations? b) (1 mark) What is the call premium that the company would need to pay? c) (2 marks) What is the tax savings per year attributable to the underwriting costs? d) (1 mark) What is the present value of the borrowing expenses of the new issue? e) (2 marks) What is the cost attributable to the duplicate interest expense? f) (2 marks) What is the after-tax net interest expense savings? g) (1 mark) What is the present value of the net savings from refinancing the bonds?
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