Longterm debt of Giovanni Industries is currently selling fo

Long-term debt of Giovanni Industries is currently selling for 110% of its face value. The issue matures in 10 years and pays an annual coupon of 8% of face. What is the before tax cost of debt for Giovanni? Also, please show how to entering number in financial calculator HP 10bII+

Solution

you need to Find Rate

Input Follwing Parameter

NPER =10

PMT=8

PV=-110

FV=100

SOLVE

RATE=6.60%