Question: All else constant, which of the following will decrease the after-tax of debt for a firm? 1. Increase in the yield to maturity of the

All else constant, which of the following will decrease the after-tax of debt for a firm?

1. Increase in the yield to maturity of the firm's outstanding debt

2. Decrease in the yield to maturity of the firm's outstanding debt

3. Increase in the firm's tax rate

4. Decrease in the firm's tax rate

a. 2 & 4

b. 2 & 3

c. 1 &4

d. 1 &3

e. 1

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