After-tax cost of capital to for bond-after-tax cost of debt

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(Cost of debt) The Walgreen Corporation is contemplating a new investment that it plans to finance using one-third debt. The firm can sell new $1,000 par value bonds with a 15-year maturity at a price of $948 that carries a coupon interest rate of 12.4 percent that is paid semiannually. If the company is in a 34 percent tax bracket, what is the after-tax cost of capital to Walgreens for the bonds?

The after-tax cost of debt is %?

Reference no: EM13850400

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