What is the aftertax cost of debt if the tax rate

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Reference no: EM13937637

Decline, Inc. is trying to determine its cost of debt. The firm has a debt issue outstanding with 15 years to maturity that is quoted at 102.7 percent of face value. The issue makes semiannual payments and has an embedded cost of 9 percent annually. What is the aftertax cost of debt if the tax rate is 35 percent?

A) 5.64 percent

B) 5.90 percent

C) 6.17 percent

D) 7.37 percent

E) 7.42 percent

Reference no: EM13937637

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