Business, 03.12.2019 03:31, ariannecama

Acompany has outstanding 20-year noncallable bonds with a face value of $1000, and 11% annual coupon, and a market price of $1,294.54. if the company was to issue new debt, what would be a reasonable estimate of the interest rate on the debt? if the company’s tax rate is 40%, what is its after-ax cost of debt?

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Acompany has outstanding 20-year noncallable bonds with a face value of $1000, and 11% annual coupon...