Question
The coupon rate on an issue of debt is 10%. The yield to maturity on this issue is 13%. The corporate tax rate is 35%.
The coupon rate on an issue of debt is 10%. The yield to maturity on this issue is 13%. The corporate tax rate is 35%. What would be the approximate after-tax cost of debt for a new issue of bonds? (Round your answer to 2 decimal places.)
Multiple Choice
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10.60%
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7.10%
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8.45%
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9.90%
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Chartered Market Technician
Authors: Market Technicians Association
1st Edition
1119361672, 978-1119361671
