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Suppose you are trying to estimate the after tax cost of debt for a firm as part of the caicutation of the Weighted Average Cost
Suppose you are trying to estimate the after tax cost of debt for a firm as part of the caicutation of the Weighted Average Cost of Capital (WACC. The corporate tax rate for this firm is 38%. The firms bonds pay interest semiannually with a 4.9% coupon rate and have a maturity of 9 yearsi if the annual yield to maturity of the bonds is 6.14%, what is the after tax cost of debt for this firm? (Answer to the nearest hundredth of a percent, e-g 12,34k, hut do not usea percent sign)
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