CFA Level 1
Corporate Finance

Calculate After-Tax Cost of Debt

Easy Cost Of Capital Cost Of Debt

Consider a company that has issued bonds with a nominal interest rate of 6% and a maturity of 10 years. The market price of the bonds is currently $1,050. The company is in a 30% tax bracket. Given this information, which of the following represents the company's after-tax cost of debt?

Hint

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