A Treasury Bond with 9 years remaining pays interest of $34.50 every six months. The...
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Accounting
A Treasury Bond with 9 years remaining pays interest of $34.50 every six months. The current yield on the bond is 7.77%. Determine the after-tax cost of debt for the firm based on this bonds yield to maturity. Assume the tax rate is 40% Hint: First determine the price of the bond.
Choose from the below answers:
4.29%
5.15%
7.77%
6.875%
8.58%
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