A Firm Has a Pretax Cost of Debt of 8

question 55

Multiple Choice

A firm has a pretax cost of debt of 8.5%. If the firm has a marginal tax rate of 30%, what is its effective cost of debt?

• A) 6.0%
• B) 8.1%
• C) 8.5%
• D) 3.4%

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Definitions:

OSHA

The Occupational Safety and Health Administration, a U.S. government agency responsible for ensuring safe and healthy working conditions by setting and enforcing standards.

Recordkeeping

The process of maintaining records or documents that track an organization's or individual's activities, transactions, and commitments.

Work-Related Injuries

Work-related injuries are injuries or illnesses that occur in the course of employment, often leading to absence from work and the need for medical care.

Low-Hazard Industries

Sectors or types of businesses that are associated with relatively lower risks to the safety and health of employees.