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Calculate the wacc change

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Reference no: EM133110098

Lowell inc. plans to issue a $1,000 par value, 20 year noncallable bond at a yield of 5 %. The company's marginal tax rate is 30%, but congress is considering a change in the corporate tax rate to 20%. By how much would the component cost of debt used to calculate the WACC change if the new tax rate was adopted?

Reference no: EM133110098

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