Alpha Corporation, a publicly held company, had issued a 25 year bonds worth $80 million at interest rate of 10% five years ago .Alpha had paid $5 million in floating cost. Alphas CFO is thinking of refinancing their debt since interest rates have declined considerably. To issue new bonds, they have to call the old bonds which have a call premium of 10%. The investments banks will charge $4 million for the floatation cost of the new issue. Alpha will have to issue new bonds one month before the old bonds are called, and the proceeds will be invested for one month in short term securities which pays 3% per year. Alphas tax rate is 40%. Should Alpha refinance its old debt?

Use the given interest rate