Micro spinoffs inc issued 20-year debt a year ago at par


Micro Spinoffs Inc. issued 20-year debt a year ago at par value with a coupon rate of 6%, paid annually. Today, the debt is selling at $1,130. If the firm's tax bracket is 30%, what is its percentageafter-tax cost of debt? Assume a face value of $1,000.

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Finance Basics: Micro spinoffs inc issued 20-year debt a year ago at par
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