The Outstanding Debt of Berstin Corp

question 97

Multiple Choice

The outstanding debt of Berstin Corp.has eight years to maturity,a current yield of 8%,and a price of $95.What is the pretax cost of debt if the tax rate is 30%.

• A)5.6%
• B)6.5%
• C)8.5%
• D)more information needed

---

Definitions:

Momentary Contact

Momentary contact refers to an electrical switch or relay contact that only completes the circuit while being physically engaged or pressed.

Three-Wire

A wiring configuration typically used in electrical circuits, incorporating a live wire, a neutral wire, and a ground wire for safety.

Normally-Open

A contact configuration in switches or relays that is open (non-conducting) when at rest, closing only when activated.

Contactor

An electrically controlled switch used for switching an electrical power circuit, commonly used in motor control applications.