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Question
Busing Manufacturing has a new bond issue that will net the firm $1,069,000. The bonds have a $1,000,000 par value, pay interest annually at a 12% coupon rate, and mature in 10 years. The firm has a marginal tax rate of 34%. The after-tax cost of the debt issue is:A) 7.15%.
B) 3.68%.
C) 7.92%.
D) 6.58%.
Answer
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Related questions
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