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Fender, Inc., is trying to determine its cost of debt. The firm has a debt issue...

Fender, Inc., is trying to determine its cost of debt. The firm has a debt issue outstanding with 27 years to maturity that is quoted at 92 percent of face value. The issue makes semiannual payments and has an embedded cost of 7 percent annually.

  

What is the company's pretax cost of debt?
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Α 1 Par Value 2 Coupon rate 3 Years to Maturity 4. Current price 5 Frequency $1,000 7% 27 $920 1 annual 7 YTM (pretax cost ofв 0.07 27 Α 1 Par Value 1000 2 Coupon rate 3 Years to Maturity 4. Current price =B1*92% 5 Frequency 6 7 YTM (pretax cost of d

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