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Posted on May 13, 2024

ABC, Inc. is issuing bonds at $ 8 4 0 . The bonds have 2 0 years to maturity with a coupon rate of 6

ABC, Inc. is issuing bonds at $

840 .

The bonds have

20

years to maturity with a coupon rate of

6.5 %

compounded semiannually. ABC

s marginal tax rate is

30 % .

What is the after

-

tax cost of debt?

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To calculate the aftertax cost of debt we need to consider the following information Bond price 840 ... blur-text-image

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