41) Tykes Toys zero coupon bond has 10 years until maturity and the bonds are...
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41) Tykes Toys zero coupon bond has 10 years until maturity and the bonds are selling in the market for $650. If the firm's after-tax cost of debt is 11 percent, what was the firm's tax rate?
A) 25.00 percent B) 30.00 percent C) 40.00 percent D) 250.00 percent
42) A firm uses only debt and equity in its capital structure. The firm's weight of equity is 35 percent. The firm's cost of equity is 14 percent and it has a tax rate of 30 percent. If the firm's WACC is 11 percent, what is the firm's before-tax cost of debt?
A) 13.41 percent B) 6.10 percent C) 5.50 percent D) 3.00 percent
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