What is the firms component cost of debt

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A company's 6 percent coupon rate, semiannual payment, $1,000 par value bond that matures in 30 years sells at a price of $515.16. The company's federal-plusstate tax rate is 40 percent. What is the firm's component cost of debt for purposes of calculating the WACC?

(Hint: Base your answer on the nominal rate.)

Reference no: EM131376112

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