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A corporate bond has a face value of $1,000and a coupon rate of 5%. The bond matures in 15 years and has a current market

A corporate bond has a face value of $1,000and a coupon rate of 5%. The bond matures in 15 years and has a current market price of $925. If the corporation sells more bonds it will incur flotaton costs off $25 per bond. If the corporate txe rate is35%, whatis the after-tax cost ofdebt capital? A. 3.74% B. 5.29% C. 4.45% D. 6.78%

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