Contract or coupon interest rate

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A bond that has SAR 1,500 par value (face value) and a contract or coupon interest rate of 13 percent. A new issue would have a flotation cost of 9 percent of the $1,620 market value. The bonds mature in 15 years. The firm's aerage tax rate is 35 percent, and its marginal tax rate is 38 percent.  DATA       face value   coupon interest rate   flotation cost   mrkt value   years   tax rate   marginal tax rate Net price =   Cost =   After-Tax cost = 

Reference no: EM131941157

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