Question
Jiminys Cricket Farm issued a 25-year, 4 percent semiannual coupon bond 5 years ago. The bond currently sells for 104 percent of its face value.
| Jiminys Cricket Farm issued a 25-year, 4 percent semiannual coupon bond 5 years ago. The bond currently sells for 104 percent of its face value. The companys tax rate is 24 percent. |
| a. | What is the companys pretax cost of debt? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) |
| b. | What is the companys aftertax cost of debt? |
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The Essentials Of Machine Learning In Finance And Accounting
Authors: Mohammad Zoynul Abedin, M. Kabir Hassan, Petr Hajek, Mohammed Mohi Uddin
1st Edition
0367480816, 978-0367480813
