What is the new aftertax cost of debt

Reference no: EM131788240

Question: For Russell Container Corporation, described in problem 10, assume that the yield on the bonds goes up by 1 percentage point and that the tax rate is now 35 percent.

a. What is the new aftertax cost of debt?

b. Has the aftertax cost of debt gone up or down from problem 10? Explain why.

Reference no: EM131788240

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