Micro spinoffs inc issued 20-year debt a year ago at par, Ask an Expert

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Micro Spinoffs Inc. issued 20-year debt a year ago at par value with a coupon rate of 4%, paid annually. Today, the debt is selling at $1,070. If the firm’s tax bracket is 40%, what is its percentage after-tax cost of debt? Assume a face value of $1,000.

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Category:- Financial Management
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