Cost of debt using both methods (ytm and the approximation formula) currently, warren industries can sell 20 dash year, $1 comma 000-par-value bonds paying annual interest at a 11% coupon rate. because current market rates for similar bonds are just under 11%, warren can sell its bonds for $1 comma 080 each; warren will incur flotation costs of $30 per bond. the firm is in the 25% tax bracket. a. find the net proceeds from the sale of the bond, upper n subscript d. b. calculate the bond's yield to maturity (ytm) to estimate the before-tax and after-tax costs of debt. c. use the approximation formula to estimate the before-tax and after-tax costs of debt.

Susie buys two goods - rounds of golf and massages. suppose that the price of a round of golf is $20, and the price of a massage is $30. in a typical week susie will play two rounds of golf, getting 20 units of satisfaction from the second round. she normally buys three massages each week, with the third giving her 30 units of satisfaction. if she were to buy a fourth massage in a week, it would give her 20 units of satisfaction. if the price of massages is reduced to $15, which of the following outcomes might we expect to occur? a) susie would leave her consumption choices unchanged because of diminishing marginal utility in the consumption of massages. b) susie would buy more massages and more rounds of golf, as predicted by the substituion effect. c) susie would buy more massages and fewer rounds of golf, as predicted by the substitution effect. d) susie would buy more massage and fewer rounds of golf, as predicted by income effect.