Compute the cost of the following: A bond that has $1,000 par value (face value) and a contract or coupon interest rate of 11 percent. A new issue would have a floatation cost of 5 percent of the $1,125 market value. The bonds mature in 10 years. The firms average tax rate is 30 percent and its marginal tax rate is 34 percent.
Paper#5735 | Written in 18-Jul-2015Price : $25