The interest rate is 12% and the tax savings (1-0.40) then the after-tax compone

Question

The interest rate is 12% and the tax savings (1-0.40) then the after-tax component cost of debt will be

Options:

A . 0.072

B . 7.2 times

C . 17.14 times

D . 17.14

Answer: Option A
Answer: (a).0.072

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