1 a) LL Incorporated's currently outstanding 7% coupon bonds have a yield to maturity of 4.7%. LL believes it could issue new bonds at par that would provide a similar yield to maturity. If its marginal tax rate is 25%, what is LL's after-tax cost of debt? Round your answer to two decimal places.

1B) plans to issue some $80 par preferred stock with a 6% dividend. A similar stock is selling on the market for $95. must pay flotation costs of 7% of the issue price. What is the cost of the preferred stock? Round your answer to two decimal places.