Inc. sells $100 million worth of 22-year to maturity 13.44% annual coupon bonds. The net proceeds are

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Inc. sells $100 million worth of 22-year to maturity 13.44% annual coupon bonds. The net proceeds are $989 for each $1000 bond. The firm's marginal tax rate is 30%. What is the after-tax cost of capital for this debt financing?

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Financial Management Principles and Applications

ISBN: 978-0134417219

13th edition

Authors: Sheridan Titman, Arthur J. Keown, John H. Martin

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Posted Date: Apr 13, 2023 02:58 AM

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Inc. sells $100 million worth of 22-year to maturity 13.44% annual coupon bonds. The net proceeds are

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To calculate the aftertax cost of debt financing we need to first calculate the beforetax cost of de... View the full answer

Financial Management Principles and Applications

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