Stancorp has a $13.8 million debt issue? outstanding,

Share With

Stancorp has a

$13.8

million debt issue? outstanding, with a

6.2%

coupon rate. The debt has? semi-annual coupons, with the next coupon is due in six months. The debt matures in five years. It is currently priced at

93%

of par value.

a. What is? Stancorp's pre-tax cost of? debt? Note: Compute the effective annual return.

b. If Stancorp faces a

30%

tax? rate, what is its? after-tax cost of? debt?

Related Questions