Qusetion: Cost of debt with fees. Kenny Enterprises will issue a bond with a par value of $1,000, a maturity of twenty years, and a coupon rate of 9.5% with semiannual payments, and will use an investment bank that charges $25 per bond for its services. What is the cost of debt for Kenny Enterprises at the following market prices?
a. $973.06
b. $1,006.62
c. $1,047.60
d. $1136.95