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QUESTION
Homework #6E (Before and after-tax cost of debt financing)
Homework #6E (Before and after-tax cost of debt financing)
Finance
Question 1 (1 point)
Black Hill Inc. sells $100 million worth of 21-year to maturity 8.91% annual coupon bonds. The net proceeds (proceeds after flotation costs) are $988 for each $1,000 bond. What is the before-tax cost of capital for this debt financing?
Round the answer to two decimal places in percentage form. (Write the percentage sign in the "units" box)
You should use Excel or financial calculator.
