A company has $5 million in debt outstanding with coupon rate of 12%. Currently the YTM on these bonds is 14%. If the firms tax rate is 40%. What is the companys after-tax cost of debt? Question 1Answer a. 8.4% b. 5.6% c. 12.0%

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A company has $5 million in debt outstanding with coupon rate of 12%. Currently the YTM on these bonds is 14%. If the firms tax rate is 40%. What is the companys after-tax cost of debt?  Question 1Answer  a.  8.4%  b.  5.6%  c.  12.0%

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