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The debt of Savanna Equipment, lncerporated has an average maturity of ten years and a BBB rating A market yieid to maturity is not available
The debt of Savanna Equipment, lncerporated has an average maturity of ten years and a BBB rating A market yieid to maturity is not available because the debt is not publicly traded, but the maket yedd on debt with similar chacteristics is 8.33% Savanna is planning to issue new ten-year notes that would be subordinate fo the fim's cxisting debt. The compary's morginal tax-rate is 40%. The most appropriate estirnate of the alter-tax cost of this new debt is: Matoper Choice Morw than 50 : between 33 s and 500
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