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A company is trying to determine its cost of debt. The firm has a debt issue outstanding with 10 years to maturity, current value of
A company is trying to determine its cost of debt. The firm has a debt issue outstanding with 10 years to maturity, current value of $900, and par value of $1,000. The bond makes semiannual payments and has a coupon rate of 5 percent. If the tax rate is 20 percent, what is the after-tax cost of debt?
Please provide steps and do not use excel, Thank you!
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