Reinvestment means, "Reinvestment" means. What is the

Reinvestment means

Assignment Help Financial Management

Reference no: EM132000056

1. "Reinvestment" means:

a. New investment in new operations

b. Additional investment in existing operations

c. New investment by new shareholders

d. Additional investment by existing shareholders

Explain

2. The outstanding bonds of Tech Express are priced at $1,092 and mature in 10 years. These bonds have a face value of $1,000, a coupon rate of 7.68 percent, and pay interest annually. The firm's tax rate is 21 percent. What is the firm's after tax cost of debt?

A. 5.06 percent

B. 7.68 percent

C. 4.81 percent

D. 6.40 percent

Reference no: EM132000056

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