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Builtrite Supply is considering selling bonds for a plant expansion. Currently, Builtrite believes that it could sell 1 2 - year maturity, $ 1 0

Builtrite Supply is considering selling bonds for a plant expansion. Currently, Builtrite believes that it could sell 12-year maturity, $1000 par value, 73/8% coupon bonds after flotation costs for $1036. If Builtrite is in the 34% marginal tax bracket, what is the after-tax cost for the bonds?5.71%3.77%6.91%4.56%

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