Oberon Inc. has a $20 million ($1000 face value) 10-year bond issue selling for 99% of par that pays an annual coupon of 7.25%. What would be Oberon's before-tax component cost of debt?
A) 6.12%
B) 7.02%
C) 7.40%
D) 8.15%
Correct Answer:
Verified
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