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Advance, Inc. is trying to determine its cost of debt. The firm has a debt issue outstanding with 17 years to maturity that is quoted
Advance, Inc. is trying to determine its cost of debt. The firm has a debt issue outstanding with 17 years to maturity that is quoted at 95 percent of face vale. The issue makes semiannual payments and has a coupon rate od 8% annually. What is Advances pretax cost of debt? If the tax rate is 35%, what is the aftertax cost of debt?
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