Demonstrate what is after tax cost of debt

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Problem 1: 5 years ago, Barron Corp. issued 25 year noncallable semiannual bonds with face value $1550 and a 6% coupon, semi annual payment of $46.50. Bonds currently sell at $845.87. Firm's marginal tax bracket is 40%. What is after tax cost of debt? Round answer 2 places please.

Reference no: EM132658142

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