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A 20 -year, 11% annual coupon bond sells for $968.30. What is after-tax the cost of debt (rd) if marginal tax rate is 25% ?

A 20 -year, 11% annual coupon bond sells for $968.30. What is after-tax the cost of debt (rd) if marginal tax rate is 25% ? Interest is tax deductible, so ATrd=BTrd(1T)= Use nominal rate. Flotation costs are small, so ignore them

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