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Question: you are analyzing the aftertax cost of debt for a...

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You are analyzing the after-tax cost of debt for a firm. You know that the firm’s 12-year maturity, 15.50 percent semiannual coupon bonds are selling at a price of $1,117.25. These bonds are the only debt outstanding for the firm.

YTM?

After tax cost of debt at marginal 34% tax rate?



Then if selling at par YTM and after tax cost of debt?



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