Question: Reposting because the last answer was incorrect. Please answer both parts. The formula for part A is EAR = (1 + YTM) 2 -1. The

Reposting because the last answer was incorrect. Please answer both parts. The formula for part A is EAR = (1 + YTM)²-1. The formula for part B is EAR x (1 - T_C). Please answer according to those formulas.

Avicorp has a $10.8 million debt issue outstanding, with a 5.9% coupon rate. The debt has semi-annual coupons, the next coupon is due in six months, and the debt matures in five years. It is currently priced at 95% of par value. a. What is Avicorp's pre-tax cost of debt? Note: Compute the effective annual return b. If Avicorp faces a 40% tax rate, what is its after-tax cost of debt

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