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Which formulas give the appropriate cost of debt

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Question - Katie's frozen foods has an average tax rate of 29% and a marginal tax rate of 35%. The bank offers a three-year loan at a six percent interest rate. Which of the following formulas give the appropriate cost of debt lf this loan?

a. 6% * 0.35

b. 6% *0.29

c. 6% * (1-0.35)

d. 6% * (1-0.29)

Reference no: EM133123778

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