Question
Proteak, S.A.B. de C.V. will generate $ 10 million in debt capital with the issuance of 10 thousand bonds of $ 1,000.00 with 8% per
Proteak, S.A.B. de C.V. will generate $ 10 million in debt capital with the issuance of 10 thousand bonds of $ 1,000.00 with 8% per year for 10 years. If the company's effective tax rate is 28% and the bonds are discounted at 2%.
Calculate the cost of equity of debt a) before taxes and b) after taxes from the company's perspective.
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Fundamentals Of Investing
Authors: Scott B. Smart, Lawrence J. Gitman, Michael D. Joehnk
13th Edition
978-0134083308, 013408330X
