What is the after-tax cost of capital for this debt financing?

Business & Finance
Price: $5 USD

Question description

Great Seneca Inc. sells $100 million worth of 25-year to maturity 13.76% annual coupon bonds. The net proceeds (proceeds after flotation costs) are $992 for each $1,000 bond. The firm's marginal tax rate is 30%. What is the after-tax cost of capital for this debt financing?

Round the answer to two decimal places in percentage form. 

You should use Excel or financial calculator.

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