Business, 07.04.2020 19:55 MyaaaMoney

A company is going to issue a $1,000 par value bond that pays a 5% annual coupon. The company expects investors to pay $684.5 for the 20-year bond. The expected flotation cost per bond is $50, and the firm is in the 45% tax bracket. Compute the firm's after-tax cost of new debt. Round your calculations to the nearest 0.01%. Group of answer choices

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A company is going to issue a $1,000 par value bond that pays a 5% annual coupon. The company expect...

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