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Question 9 2 pts Greco Corporation is considering issuing long-term debt with a par value of $1000. The debt would have a 30-year maturity and
Question 9 2 pts Greco Corporation is considering issuing long-term debt with a par value of $1000. The debt would have a 30-year maturity and a 10 percent coupon rate. In order to sell the issue, the bonds must be underpriced at a discount of 5 percent of face value. In addition, the firm would have to pay flotation costs of 4 percent of face value. The firm's tax rate is 35 percent. Given this information, the after-tax cost of debt for Greco Corporation would be (3 points for the solution) 8.24% 10.34% 10.79% 7.01%
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