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A company’s investment banker estimates that it could sell 10-year semiannual bonds with a coupon rate...

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Finance

A company’s investment banker estimates that it could sell10-year semiannual bonds with a coupon rate of 5%. The face valuewould be$1,000 and the flotation costs for a bond issue would be1%. The firm faces a 35% tax rate. What is the firm's After-taxcost of debt

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AfterTax Cost of Debt The AfterTax Cost of Debt is the AfterTax Yield to maturity of YTM of the Bond and is calculated using financial calculator as follows Normally the    See Answer
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A company’s investment banker estimates that it could sell10-year semiannual bonds with a coupon rate of 5%. The face valuewould be$1,000 and the flotation costs for a bond issue would be1%. The firm faces a 35% tax rate. What is the firm's After-taxcost of debt

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