7. Laurel, Inc., has debt outstanding with a coupon rate of 5.9% and a yield to maturity of 7.2%. Its tax rate is 35%. What is Laurel's effective (after-tax) cost of debt? NOTE: Assume that the debt has annual coupons and that the firm will always be able to utilize its full interest tax shield. The effective after-tax cost of debt is ___%? (Round to four decimal places.)

8. Dewyco has preferred stock trading at $53 per share. The next preferred dividend of $6 is due in one year. What is Dewyco's cost of capital for the preferred stock? The cost of capital for preferred stock is ___%? (Round to one decimal place.)