A company's 4% coupon rate, semiannual payment, $1,000 par value bond that matures in 20 years sells at a price of $485.
Posted: Wed Mar 30, 2022 3:51 pm
A company's 4% coupon rate, semiannual payment, $1,000 par value
bond that matures in 20 years sells at a price of $485.23. The
company's federal-plus-state tax rate is 25%. What is the firm's
after-tax component cost of debt for purposes of calculating the
WACC? (Hint: Base your answer on
the nominal rate.) Round your answer to one
decimal place.
bond that matures in 20 years sells at a price of $485.23. The
company's federal-plus-state tax rate is 25%. What is the firm's
after-tax component cost of debt for purposes of calculating the
WACC? (Hint: Base your answer on
the nominal rate.) Round your answer to one
decimal place.