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Suppose a parent company wishes to determine the expected after-tax dollar cost of Rs.600 million local debt (at 16 per cent) raised by its subsidiary
Suppose a parent company wishes to determine the expected after-tax dollar cost of Rs.600 million local debt (at 16 per cent) raised by its subsidiary company S. Assuming a tax rate of 40 per cent, anticipated average annual devaluation of 3 per cent of the Indian rupee in relation to the US dollar and tax deduction of foreign, exchange losses, compute the cost of the debt
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