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Builtrite Furniture is considering sells bonds for a plant expansion. Currently, Builtrite believes that it could sell 15-year maturity, $1000 par value, 35/8% coupon bonds

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Builtrite Furniture is considering sells bonds for a plant expansion. Currently, Builtrite believes that it could sell 15-year maturity, \$1000 par value, 35/8% coupon bonds after flotation costs for $1030. If Builtrite is in the 34% marginal tax bracket, what is the after-tax cost for the bonds? 2.48% 3.75% 2.22% 3.36%

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