selling for $960. If the firm's tax rate is 40%, what would be the after-tax cost of issuing new d Round your answer to one tenth of a percent.) O 3.6% 5.4% 4.5% O 9.0%
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- The Christopher Co. issued 8%, semi-annuall coupon bonds with 6 years to maturity. Each bond is currently selling for $890. If the firm's tax rate is 35%, what would be the after-tax cost of issuing new debt? (Round your answer to one tenth of a percent.) ○ 3.7% 6.84% O 10.5% 5.26%Jiminy's Cricket Farm issued six years ago a 30-year $1000 face value bond with an 8 percent annual coupon rate that has semiannual payments. The bond currently sells for $1,140. What is the after-tax cost of debt if the company's tax rate is 35 percent? O 4.425% 4.145% 4.955% 5.065%Inventive Response has bonds outstanding that mature in 8.5 years, have a 4 percent coupon, and pay interest annually. These bonds have a face value of $1,000 and a current market price of $1,180.30. What is the company’s after-tax cost of debt if its tax rate is 21 percent? 1.35 percent 1.70 percent 2.15 percent 2.65 percent 3.40 percent
- Inventive Response has bonds outstanding that mature in 8.5 years, have a 4 percent coupon, and pay interest annually. These bonds have a face value of $1,000 and a current market price of $1,180.30. What is the company’s after-tax cost of debt if its tax rate is 21 percent? 1.35 percent 1.70 percent 2.15 percent 2.65 percent 3.40 percent Therapeutic Solutions Inc. just paid an annual dividend of $1.45 per share last year. The market price of the stock is $26.30 and the growth rate is 5 percent. What is the firm’s cost of equity? 10.51 percent 10.79 percent 11.06 percent 11.44 percent 11.85 percentThe 10-year Treasury rate is 2.15 percent, and a firm’s credit rating is BBB. The firm has had many bond issues in the past, and decides to raise $100 million by selling 10-year bonds. At present, 10-year BBB bonds are selling for 225 basis points above the 10-year Treasury rate. What is the cost of borrowing? a. 4.40% b. 2.15% c. 2.25% d. 2.38%A company has outstanding long-term bonds with a face value of$1,000, a 10% coupon rate, 25 years remaining until maturity, anda current market value of $1,214.82. If it pays interest semiannually,then what is the nominal annual pre-tax required rate of return ondebt? (8%) If the company’s tax rate is 40%, what is the after-taxcost of debt? (4.8%)
- A firm sold a 10-year bond issue 3 years ago. The bond has a 6.45% annual coupon and a $1,000 face value. If the current market price of the bong is $951.64 and the tax rate is 35%, what is the after- tax cost of debt? O 4.64% O 4.19% O 4.95% O 4.41% O 4.78%ABC Co. can issue P1,000 par value bond that pays P100 per year in interest at a price of P980. The bond will have a 5-year life. The firm is in a 35% tax bracket. What is the after-tax cost of debt? A. 5.87% B. 6.8% C. 9.03% D. 9.14%Sony bonds were issued 8 years ago with a coupon rate of 9%. The bond has 2 years left to maturity and is currently selling for $880. The firm typically falls under a 40% tax rate. Based on this informaiton, what is their after-tax cost of debt? Assume coupon payments are made semiannually.
- Mechmar Corp Berhad bonds pay $70 in annual interest, with a $1,000 par value. The bonds mature in 17 years. Your required rate of return is 8.5% per year. Calculate the value of the bond and interpret your answer. In your opinion, does the bond value change if your required rate of return (k) increase to 11% per year and in another scenario decease to 6% per year?The 8.5percent annual coupon bonds of the ABC Co. are selling for $1,179. The bondsmature in 12 years. The bonds have a par value of $1,000. If the tax rate is30%, what is the after-tax cost of debt?Enter your answer in percentages rounded off to two decimalpoints. Do not enter % in the answer box.Balmar Corporation bonds have a $1,000 face value and will mature in 4 years. The bonds have a 7% coupon rate. Interest is paid annually and the required rate of return is 6 percent for these bonds. 1. What is the price of the Balmar corporate bonds? 2. What is the Macaulay duration of the Balmar corporate bonds? 3. What is the Modified duration of the Balmar corporate bonds? 4. If interest rates increase 50 basis points, what will be the new price for the Balmar bond?