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Waller, Inc., is trying to determine its cost of debt. The firm has a debt issue...

Waller, Inc., is trying to determine its cost of debt. The firm has a debt issue outstanding with 14 years to maturity that is quoted at 104 percent of face value. The issue makes semiannual payments and has an embedded cost of 7 percent annually.
(a) What is the company's pretax cost of debt? (Do not round your intermediate calculations.)
(Click to select)7.20%6.89%6.56%6.23%6.82%

  

(b)

If the tax rate is 35 percent, what is the aftertax cost of debt? (Do not round your intermediate calculations.)

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SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

jeff jeffy answered 10 months ago
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