Question: Greene Co. is planning a project for which it will issue new bonds. Bonds in the same risk class issued by another firm are currently

Greene Co. is planning a project for which it will issue new bonds. Bonds in the same risk class issued by another firm are currently priced at $954.90, have 25 years remaining to maturity, and pay coupons of $75 every year. If Greene's marginal tax rate is 34%, what is the pre-tax cost of debt for the project?

Multiple Choice

7.92%

7.50%

7.20%

8.12%

9.04%

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