Question: Intro Simple Corp. has one bond issue oustanding, with a maturity of 10.5 years, a coupon rate of 3.8% and a yield to maturity of

Intro Simple Corp. has one bond issue oustanding, with a maturity of 10.5 years, a coupon rate of 3.8% and a yield to maturity of 4.7%. Simple Corp.'s average tax rate is 18% and its marginal tax rate is 34%. Part 1 What is the (pre-tax) cost of debt? 4.7% Correct The pre-tax cost of debt equals the yield to maturity on a bond, or 0.047 in this case. Part 2 What is the after-tax cost of debt? + decimals Submit Attempt 1/10 for 10 pts. B Attempt 1/10 for 10 pts

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