Find pre-tax cost of debt capital

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Reference no: EM131967429

You know that the after-tax cost of debt capital for Bubbles Champagne is 4.40 percent. Assume that the firm has only one issue of five-year bonds outstanding.

The bonds make semiannual coupon payments and the marginal tax rate is 30 percent. Calculate Pre-tax cost of debt capital.

Reference no: EM131967429

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