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What is the component cost of debt

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Several years ago the Jakob Company sold a $1,000 par value, noncallable bond that now has 20 years to maturity and a 7.00% annual coupon that is paid semiannually. The bond currently sells for $875 and the company's tax rate is 25%. What is the component cost of debt for use in the WACC calculation? Do not round your intermediate calculations.

Reference no: EM133110306

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