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Suppose you are trying to estimate the after tax cost of debtfor a firm as part of the calculation of the Weighted Average Costof Capital (WACC). The corporate tax rate for this firm is 35%. Thefirm's bonds pay interest semiannually with a 7.1% coupon rate andhave a maturity of 13 years. If the current price of the bonds is$934.64, what is the after tax cost of debt for this firm? (Answerto the nearest tenth of a percent, e.g. 12.3%, but do not use apercent sign).
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