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Bond Yield and After-Tax Cost of Debt A company's 4% coupon rate, semiannual payment, $1,000 par value bond that matures in 25 years sells at
Bond Yield and After-Tax Cost of Debt A company's 4\% coupon rate, semiannual payment, $1,000 par value bond that matures in 25 years sells at a price of $570.36. The company's federal-plus-state tax rate is 25%. What is the firm's after-tax component cost of debt for purposes of calculating the WACC? (Hint: Base your answer on the nominal rate.) Round your answer to one decimal place. % Step by Step Solution
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Analysis For Financial Management
Authors: Robert Higgins
6th Edition
0071181172, 9780071181174
