The before-tax cost of debt for a firm which has a 40 percent marginal tax rate is 12 percent. The after-tax cost of debt is:
A.	4.8 percent
B.	6.0 percent
C.	7.2 percent
D.	12 percent
Answer:C
The before-tax cost of debt for a firm which has a 40 percent marginal tax rate is 12 percent. The after-tax cost of debt is:
A.	4.8 percent B.	6.0 percent C.	7.2 percent D.	12 percent