Question

Suppose firm ABC can issue new 10-year bonds at par value. The bonds pay 6-percent annual...

Suppose firm ABC can issue new 10-year bonds at par value. The bonds pay 6-percent

annual coupons, and the marginal tax rate is 30%. The before-tax issuing costs are 2.5%

of par. Estimate the firm's after-tax cost of debt.

answer 4.42%

how to get that answer with explanation, formula , financial calculator

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