Waller, Inc., is trying to determine its cost of debt. The firm has a debt issue outstanding with 11 years to maturity that is quoted at 99 percent of face value. The issue makes semiannual payments and has an embedded cost of 6 percent annually.a. What is the company's pretax cost of debt? (Do not round your intermediate calculations.)1. 5.82%2. 6.20%3. 6.43%4. 6.13%5. 6.37%b. If the tax rate is 34 percent, what is the after tax cost of debt? (Do not round your intermediate calculations.)1. 2.71%2. 4.25%3. 3.84%4. 4.04%5. 4.21%.
