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Laurel, Inc., has debt outstanding with a coupon rate of 5.9% and a yield to maturity of 7.2%. Its tax rate is 35%. What is
Laurel, Inc., has debt outstanding with a coupon rate of 5.9% and a yield to maturity of 7.2%. Its tax rate is 35%. What is Laurel's effective (after-tax) cost of debt? NOTE: Assume that the debt has annual coupons and that the firm will always be able to utilize its full interest tax shield. The effective after-tax cost of debt is \%. (Round to four decimal places.) Step by Step Solution
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Personal Finance An Integrated Approach
Authors: Bernard J. Winger
4th Edition
0198520972, 9780132696302
