Question
MULTPLE CHOICE A company with a tax rate of35% borrows$150M from Lender A at a cost of9% and$350M from Lender B at a cost of12%.
MULTPLE CHOICE
A company with a tax rate of35% borrows$150M from Lender A at a cost of9% and$350M from Lender B at a cost of12%. What is thefirm's aggregate cost of borrowing(a) before; and(b) aftertaxes?
A.7.80%; 7.35%
B.7.22%; 11.00%
C.7.35%; 7.80%
D.11.10%; 7.22%
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Microeconomics: An Intuitive Approach With Calculus
Authors: Thomas Nechyba
2nd Edition
1305650468, 978-1305650466
