Keyspan corp. is planning to issue debt that will mature in 2030. In many respects, the issue is similar to the currently outstanding debt of the corporation. Use Table 11-3.

a. Calculate the yield to maturity on similarly outstanding debt for the firm in terms of maturity. (Input your answer as a percent rounded to 2 decimal places.)

Assume that because the new debt will be issued at par, the required yield to maturity will be 0.26 percent higher than the value determined in part a.

b. What is the new yield to maturity? (Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.)

c. If the firm is in a 25 percent tax bracket, what is the aftertax cost of debt for the yield determined in part b? (Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.)

Maturity Date Nov-15-2030 Apr-01-2033 Apr-01-2035 Issue KeySpan Corporation KeySpan Corporation KeySpan Corporation Security Type Corporate Debentures Corporate Debentures Corporate Debentures Seniority Senior Unsecured Senior Unsecured Senior Unsecured Coupon 8.000 5.875 5.803 Offer Date Nov-15-2000 Apr-01-2003 Mar-29-2005 Amt.Outstdg. Current (mm) Price 250.00 131.285 150.00 117.973 307.20 117.973 Current YTM 4.710 4.250 4.021 S&P Rating BBB+ BBB+ BBB+