2 years ago Mickey's Mouse Emporium issued a bond with 16 years to maturity. The bond pays an annual coupon of 6 percent. The bond currently sells for 91 percent of its face value and has a yield to maturity of 7.02%. The companys tax rate is 38 percent. The book value of the debt issue is $40 million.

In addition, Mickey's Mouse Emporium issued a zero coupon bond that yields 6.40% with 11 years left to maturity; the book value of this bond issue is $30 million, and the bonds sell for 50 percent of par.

What is the company's (after-tax) cost of debt based on the debts' market value? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Cost of debt

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