You are analyzing the after-tax cost of debt for a firm. You know that the firm’s 12-year maturity, 10.75 percent semiannual coupon bonds are selling at a price of $814.61. If these bonds are the only debt outstanding for the firm.
What is the current YTM of the bonds?
What is the after-tax cost of debt for this firm if it has a marginal tax rate of 34 percent?
What is the current YTM of the bonds and after-tax cost of debt for this firm if the bonds are selling at par?
(Round final answers to 2 decimal places,)
Please show your work)