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-   -   If a firm's bonds are currently yielding 8% in the marketplace (https://www.askmehelpdesk.com/showthread.php?t=693175)

  • Aug 12, 2012, 06:30 PM
    4sutter
    If a firm's bonds are currently yielding 8% in the marketplace
    If a firm's bonds are currently yielding 8% in the marketplace, why would the firm's cost of debt be lower?

    a) interest rates have changed
    b) additional debt can be issued more cheaply than the original debt
    c) there should be no difference; cost of debt is the same as the bond's market yield
    d) interest is tax-deductible

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