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Great Seneca Inc. sells $100 million worth of 27-year to maturity 13.39% annual coupon bonds. The net proceeds (proceeds after flotation costs) are $972 for

Great Seneca Inc. sells $100 million worth of 27-year to maturity 13.39% annual coupon bonds. The net proceeds (proceeds after flotation costs) are $972 for each $1000 bond. The firms marginal tax rate is 35%. What is the after tax cost of capital for this debt financing?

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