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Lexington's bonds have 15 years to maturity with a coupon rate of 6.5%. Interest is paid semi- annually. The bonds sold at par value, but

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Lexington's bonds have 15 years to maturity with a coupon rate of 6.5%. Interest is paid semi- annually. The bonds sold at par value, but the firm paid flotation costs amounting to 5% of par value. The firm has a marginal tax rate of 21%. What is the firm's after-tax cost of debt for these bonds? O 5.57% 7.05% 0 4,65% 6.5% 5.14%

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