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What is the pretax cost of debt

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Reference no: EM132005606

Kevin's Farm issued a 30-year, 9.8 percent semiannual bond 5 years ago. The bond currently sells for 87 percent of its face value. The company's tax rate is 40 percent

a) What is the pretax cost of debt?

b) What is the aftertax cost of debt?

Reference no: EM132005606

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