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JKL Co's bonds, which pay annual coupon interest at a rate of 5 . 5 % , have a face value of $ 1 ,

JKL Co's bonds, which pay annual coupon interest at a rate of

5.5 %,

have a face value of $

1, 000

and mature in

9

years are currently trading for $

947.00 .

If JKL Co is in the

34 %

tax bracket, what is its after

-

tax cost of debt?

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