Galvatron Metals has a bond outstanding with a coupon rate of 6.7 percent and semiannual payments. The bond currently sells for $1,863 and matures in 21 years. The par value is $2,000 and the company's tax rate is 21 percent. What is the company's aftertax cost of debt? 4.67% 3.67% 3.43% 4.07% 5.80%

Galvatron Metals has a bond outstanding with a coupon rate of 6.7 percent and semiannual payments. The bond currently sells for $1,863 and matures in 21 years. The par value is $2,000 and the company's tax rate is 21 percent. What is the company's aftertax cost of debt? 4.67% 3.67% 3.43% 4.07% 5.80%

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter11: The Cost Of Capital

Section: Chapter Questions

Problem 2PROB

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