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Determine the appropriate after-tax cost of debt

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Question - If the question is: RM Inc. has a marginal tax rate of 35%. It can issue 10-year bonds with an annual coupon rate of 7% and a par value of $1,000. New bonds will net the company $966 in proceeds. Determine the appropriate after-tax cost of debt for the firm to use in its capital budgeting analysis.

Reference no: EM132534481

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