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You issued debt in the form of bonds, with a face value of $1,000, and have 10 years until maturity. The bonds have an
You issued debt in the form of bonds, with a face value of $1,000, and have 10 years until maturity. The bonds have an annual coupon rate of 6.8%, which are paid semiannually. a. The current price is $1,075. What is the pretax cost of debt? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 12.34.) b. The tax rate is 25%. What is the aftertax cost of debt? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 12.34.) a. Pretax cost of debt % b. Aftertax cost fo debt % You want to calculate the weighted average cost of capital. The dividend just paid is $3.00/share. It is anticipated to grow at a rate of 5% for the foreseeable future. What is the cost of equity if the current price of stock is $44.80 a share? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 12.34.) Cost of equity %
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