$18$ Last year, a company issued $$50$ million of debt that was entirely bought by a private

investor. This debt, which was issued at par and is not traded, has a nine$-$year remaining life

and pays $8\mathrm{.}0$ percent interest on a semiannual basis. If the company were to issue $$10$ million

in new debt today at par value, it would have to pay a coupon of $9\mathrm{.}0$ percent. The company's

equity has an estimated market value of $$5$ million and the estimated cost of equity capital

is $20$ percent. The company has no additional debt or equity outstanding and is currently,

and for the foreseeable future, paying no taxes due to past and expected future losses. In

determining the company's weighted average cost of capital, the appropriate after$-$tax cost

$g^f$ debt is closest to:

A $8\mathrm{.}0$ percent.

$($B$)9\mathrm{.}0$ percent.

C $12\mathrm{.}0$ percent.