Multiple Choice
The coupon rate on an issue of debt is 12%.The yield to maturity on this issue is 14%.The corporate tax rate is 31%.What would be the approximate after tax cost of debt for a new issue of bonds?
A) 4.34%
B) 3.72%
C) 9.66%
D) 8.28%
Correct Answer:
Verified
Correct Answer:
Verified
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