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Original yield to maturity on latest bonds issued by firm

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Reference no: EM132033969

The pre-tax cost of debt: Is based on the current yield to maturity of the firm's outstanding bonds. Is equal to the coupon rate on the latest bonds issued by a firm. Is equivalent to the average current yield on all of a firm's outstanding bonds. Is based on the original yield to maturity on the latest bonds issued by a firm. Has to be estimated as it cannot be directly observed in the market.

Reference no: EM132033969

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