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A coupon rate is not a good estimate of a firm's cost of debt, as it is only a reflection of the firm's cost of debt when bonds were issued, not the current cost of debt. It's not representative of the yield in the current market.

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11y ago

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Why does the weighted average cost of capital of firms that uses more debt capital lower that that of a firm that uses less debt capital?

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From your query i just got to know that you want the figure of tax percentage on your debt. I think you should concern some financial companies which would provide you more clear idea regrading your question. Today the companies are emerging with great schemes with low interests and for bad credits.


What do firms owe their creditors?

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What if The heuser company currently outstanding bonds have 10percent coupon and a 12 percent yield to maturiity and a mariginal tax rate of 35 percent what is the after tax cost of debt?

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