Question: why? 6. A B Ic D Bond ($1,000 par) | Coupon rate Time to Premium or discount Maturity 9 % 16 years $250 7 %

why? 6. A B Ic D Bond ($1,000 par) | Coupon

why?

6. A B Ic D Bond ($1,000 par) | Coupon rate Time to Premium or discount Maturity 9 % 16 years $250 7 % 5 years 50 6% 7 years par 10 years -75 Assume coupons are paid semi-annually and the tax rate is 40%. Which bond has a before-tax cost of debt that is higher than the coupon rate? A. Bond A B. Bond B C. Bond C D. Bond D 5%

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