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ABC Co. just issued a 10 year bond. This bond has a coupon rate of 4% and makes semi-annual payments. The par value on the

ABC Co. just issued a 10 year bond. This bond has a coupon rate of 4% and makes semi-annual payments. The par value on the bond is $1,000. The tax rate is 40%. Calculate the before-tax cost of debt on the bond.

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