3. Cost of debt Aa Aa The is the interest rate that a firm pays on any new debt financing. Perpetua!cold Refrigeration Company (PRC) can borrow funds at an interest rate of 7.30% for a period of four years. Its marginal federal-plus-state tax rate is 40%. PRC's after-tax cost of debt is places) (rounded to two decimal At the present time, Perpetualcold Refrigeration Company (PRC) has 10-year noncallable bonds with a face value of $1,000 that are outstanding. These bonds have a current market price of $1,278.41 per bond, carry a coupon rate of 11%, and distribute annual coupon payments. The company incurs a federal-plus-state tax rate of 40%. If PRC wants to issue new debt, what would be a reasonable estimate for its after-tax cost of debt (rounded to two decimal places)? o 4.85% o 5.06% 3.80% 4.22%