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Five Rivers Casino is undergoing a major expansion. The expansion will be financed by issuing new 15-year, $1,000 par, 9% annual coupon bonds. The market
Five Rivers Casino is undergoing a major expansion. The expansion will be financed by issuing new 15-year, $1,000 par, 9% annual coupon bonds. The market price of the bond is expected to be $1,070 each. Five Rivers flotation expense on the new bonds will be 4.75%. Five Rivers marginal tax rate is 35%. What is the after tax cost of these new bonds?
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