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please help Question 1 Proton Corp. has bonds outstanding that have a yield to maturity (YTM) of 8% and a coupon rate of 6.5%. Proton
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Question 1 Proton Corp. has bonds outstanding that have a yield to maturity (YTM) of 8% and a coupon rate of 6.5\%. Proton has a marginal tax rate of 40 percent. What is the after-tax cost of debt for Proton? 8.0% 6.5% 3.9% 4.8% Question 2 7.5pt The YTM on the outstanding bonds for Vold Corp. is 7.75\%. Analysts expect Vold common stock, which currently sells for $15 a share, to p3y an annual dividend of $0.95 a share one year from today; dividends are expected to grow 6% a year indefinitely. The flotation cost for selling new shares is 10%. Vold has a target capital structure of 45% debt and 55% equity. Compute Vold's WACC assuming it has a 40% marginal tax rate and must issue new shares of common stock. 7.64% 6.89% 9.26% 8.04% Question 3 7pts C3 Corp sold a noncallable bond five years ago at par value ($1,000) that now sells at a price of $1,075 and matures in 20 years. This bond has a 9.25% annual coupon which is paid semiannually. If the firm's tax rate is 40%, what is the after-tax cost of debt for use in the WACc calculation? 7.44% 4.51 5.08 423x Step by Step Solution
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