Question
KSS has $1000 par value bonds with a 5% coupon rate and coupons paid semi-annually that mature in 25 years. The bonds are selling for
KSS has $1000 par value bonds with a 5% coupon rate and coupons paid semi-annually that mature in 25 years. The bonds are selling for $1,050. KSS has an average tax rate of 30%. KSS is in the 40% marginal tax bracket. What is the after-tax cost of debt?
Group of answer choices
2.80%
3.95%
5.11%
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Financial Risk Manager Handbook
Authors: Philippe Jorion, Global Association Of Risk Professionals
5th Edition
0470479612, 978-0470479612
