In Bond Refunding Analysis the Is Believed to Be the Most

question 17

Multiple Choice

In bond refunding analysis the is believed to be the most appropriate discount rate.

• A)after-tax cost of new debt
• B)firm's marginal cost of capital
• C)weighted average cost of capital
• D)both b and c

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Definitions:

Payroll Tax

A tax imposed on employers and employees, calculated as a percentage of the wages that employers pay their staff.

Federal Receipts

Revenue collected by the federal government, generally through taxes and fees.

Marginal Tax Rate

The Marginal Tax Rate is the tax rate applied to an individual's or corporation's last dollar of income, showing the fraction of additional income that is paid in tax.

Average Tax Rate

The average tax rate is the percentage of total income that an individual or corporation pays in taxes, calculated by dividing total tax paid by total income.