If the pre tax cost of debt for a firm, which has a 30 percent marginal tax rate is 12 percent

Finance Dec 24, 2020

If the pre tax cost of debt for a firm, which has a 30 percent marginal tax rate is 12 percent. The after tax cost of debt is 15.6 percent O 12 percent 3.6 percent O 8.4 percent

Expert Solution

The answers to the given question are provided in the order below

after tax cost of debt=pre-tax cost of debt*(1-tax rate)
=12%*(1-30%)
=8.4000%

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