Question
Jiminy's Cricket Farm issued a 30-year, 7.6 percent semiannual bond 6 years ago. The bond currently sells for 92.5 percent of its face value. The
| Jiminy's Cricket Farm issued a 30-year, 7.6 percent semiannual bond 6 years ago. The bond currently sells for 92.5 percent of its face value. The companys tax rate is 38 percent. |
| Required: | |
| (a) | What is the pretax cost of debt? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).) |
| Pretax cost of debt | % |
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School Finance A Policy Perspective
Authors: Allan Odden, Lawrence Picus
5th Edition
0078110289, 978-0078110283
