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Dyl Inc.'s bonds currently sell for $970 and have a par value of $1,000. They pay a $32.50 semi-annual coupon and have a 15-year maturity.

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Dyl Inc.'s bonds currently sell for $970 and have a par value of $1,000. They pay a $32.50 semi-annual coupon and have a 15-year maturity. The marginal tax-rate is 25%. What is the pre-tax cost of debt? 5.26% 6.82% 5.87% 7.92%

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