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Estimate the firm cost of debt

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Reference no: EM132935030

Question - Estimate the firm's cost of debt. - Assume that the only long-term debt the firm has is 3.85% coupon bonds (due Dec 2031 issued at @100 each). - The bonds are currently priced at $97 each and pay annually on 31st December. - Default rate is 0.5% and the expected loss rate in the event of default is 58%.

Reference no: EM132935030

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