The encroachment, breach, or violation of a right, law, regulation, or contract. The term is most frequently used in reference to the invasion of rights secured by Copyright, patent, or trademark.
Multiply the after-tax interest rate of your debt by the principal amount of your debt. The result will be the true annual dollar cost of your debt. For example, if your loan is for $100,000, your interest rate is 5 percent and your after-tax interest rate is 4 percent, $100,000 times 4 percent equals $4,000.
Agency cost of debt refers to an increase in cost of debt when the interests of shareholders and management diverge. For this reason, debt suppliers, like bondholders, impose certain restrictions on companies (via bond indentures) because of a fear of agency-cost problems. Agency cost of debt refers to an increase in cost of debt when the interests of shareholders and management diverge.