Question
Host Resorts has bonds outstanding that mature in nine years, have a 7 percent coupon, and pay semi-interest annually. These bonds have a face value
Host Resorts has bonds outstanding that mature in nine years, have a 7 percent coupon, and pay semi-interest annually.
These bonds have a face value of $1,000 and a current market price of $1,080.
What is the company's after tax cost of debt if their tax rate is 40 percent? Round up to two decimal places.
| A. | 2.92% | |
| B. | 5.84% | |
| C. | 3.51% | |
| D. | 3.79 % |
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Public Finance And Public Policy
Authors: Jonathan Gruber
2nd Edition
0716766310, 9780716766315
