1.Exactly five years ago, Lee Corp. issued bonds with an original maturity of 25 years.These bonds pay interest semiannually, and have a fixed coupon rate of 6.5%.These bonds are currently trading for $1070 for each $1000 of face value.The company faces a marginal tax rate of 25%.

 

A.Find Lee's pre-tax marginal cost of debt.

Answer rating: 100% (QA)

To find Lee Corps pretax marginal cost of debt we need to calculate the yie... View the full answer