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Avicorp has a $11.9 milion debt is outstanding, with 58% coupon rate. The debt has see annual coupons, the next coupon is doon sax months,

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Avicorp has a $11.9 milion debt is outstanding, with 58% coupon rate. The debt has see annual coupons, the next coupon is doon sax months, and the debt maturgintive years. It is currently proud 94% of par value a. What is Avicorp's pre-tax cost of debt? Note: Compute the effective annual retum b. If Avicorp faces a 40% tax rate what is its after tax cost of debt? Note: Assume that the firm will always be able to utilizes interest tax shield

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