After tax cost of capital to walgreen for the bonds

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The Walgreen Corporation is contemplating a new investment that it plans to finance using one-third debt. The firm can sell new $1000 par value bonds with a 15 year maturity at a price of $953 that carries a coupon interest rate of 12.6 percent that is paid semiannually. If the company is in a 34 percent tax bracket, what is the after tax cost of capital to Walgreen for the bonds?

Question: The after-tax cost of debt is ___%

Reference no: EM13850783

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