Chapter 6 Cost of Capital question

In both cases, the actual interest payable each year is based on the nominal value (which is always assume to be $100 unless told differently). So in example 9 the interest each year is $8 less tax), and in example 10 is $10 (less tax). When calculating the cost to the company, then when the debt is irredeemable (as in example 9, then the cost to the company is the after tax interest as a % of the market value. When the debt is redeemable (as in example 10) then we need to calculate the IRR. (I do explain this when working through examples 7 and 8)