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A company has debt outstanding which consists entirely of 8% semiannual bonds with 20 years until maturity. The bonds trade at $1040. The company has
A company has debt outstanding which consists entirely of 8% semiannual bonds with 20 years until maturity. The bonds trade at $1040. The company has revenue of $1 million, pre-tax profit of $500,000, and tax expense of $100,000. What is the companys effective cost of debt?
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