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For the cost of debt, we use the yield to maturity on 10-year bonds of the same credit rating as the company, for example, 8 percent. The tax rate, Tm, is the marginal statutory corporate rate after federal, state, and loca taxes, usually about 4l percent. Using market value weights, the debt-to-value ratio is 30 permt;therefore, the equity-to-value ratio is 70 percent.