Black hill inc sells 100 million worth of 21-year to


Finance: Before and after-tax cost of debt financing

Question

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?

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Finance Basics: Black hill inc sells 100 million worth of 21-year to
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