All of the Following Methods Can Be Used to Estimate

question 18

Multiple Choice

All of the following methods can be used to estimate the cost of debt except:

• A) If the firm targets an "A" rating (or any other bond rating), a review of the yields to maturity on A-rated bonds in Standard & Poor's Bond Guide can provide an estimate of the firm's current borrowing costs.
• B) The firm can solicit the advice of investment bankers on the cost of issuing new debt.
• C) If the firm has debt currently trading, it can use public market prices and yields to estimate its current cost of debt.
• D) A firm can seek long-term debt financing from a bank or a consortium of banks; preliminary discussions with the bankers will not indicate a ballpark interest rate the firm can expect to pay on its borrowing.

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Definitions:

Electronic Messages

Communication transmitted over digital devices, such as emails, texts, and instant messaging.

Decipher Priority

The process of determining the importance or urgency of tasks or information.

Subject-Line

The subject line of an email, intended to provide a summary of the email's contents and motivate the recipient to read the message.

Good News

News or messages that are encouraging, positive, or advantageous to those who receive them.