What is the pretax cost of debt-suspect corp

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Problem: Suspect Corp. issued a bond with a maturity of 25 years and a semiannual coupon rate of 12 percent 3 years ago. The bond currently sells for 94 percent of its face value. The company's tax rate is 35 percent.

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Question 1: What is the pretax cost of debt?

Question 2: What is the aftertax cost of debt?

Reference no: EM132474068

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