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

Question

Quizplus · Accepted Answer

The after-tax cost of new debt is considered the most appropriate discount rate in bond refunding analysis because it reflects the actual cost of replacing the old debt with new debt, taking into account the tax shield benefits.

In Bond Refunding Analysis the Is Believed to Be the Most