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QUESTION
Micro Spinoffs Inc. issued 10 year debt a year ago at a par value with a coupon rate of 8%, paid annually. Today the debt is selling at $1280.
Micro Spinoffs Inc. issued 10 year debt a year ago at a par value with a coupon rate of 8%, paid annually. Today the debt is selling at $1280. If the firm's tax bracket is 40% what is its after-tax cost of debt?
