A firm's outstanding bonds have a par value of $1,000, a coupon rate of 6%, semi-annual coupon payments, and 12 years remaining until maturity. If the bond's market price is $980 and the tax rate is 22%, what is its after-tax cost of debt? Enter your answer as an annualized rate in decimal format, and show four decimal places. For example, if your answer is 5.1%, enter .0510. Type your answer...
A firm's outstanding bonds have a par value of $1,000, a coupon rate of 6%, semi-annual coupon payments, and 12 years remaining until maturity. If the bond's market price is $980 and the tax rate is 22%, what is its after-tax cost of debt? Enter your answer as an annualized rate in decimal format, and show four decimal places. For example, if your answer is 5.1%, enter .0510. Type your answer...
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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