Question
Jiminy's Cricket Farm issued a 30-year, 9 percent semiannual bond 7 years ago. The bond currently sells for 89 percent of its face value. The
Jiminy's Cricket Farm issued a 30-year, 9 percent semiannual bond 7 years ago. The bond currently sells for 89 percent of its face value. The companys tax rate is 35 percent.
a. What is the pretax cost of debt? (Round to 2 decimal places).
b. What is the aftertax cost of debt? (Round to 2 decimal places).
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Handbook Of Environmental And Sustainable Finance
Authors: Vikash Ramiah, Greg N. Gregoriou
1st Edition
012803615X, 978-0128036150
