Aa A a E 2. Cost of debt The before-tax cost of debt s the interest rate that a firm pays on any new debt financing before-tax cost of debt after-tax cost of debt Perpetualcold Refrigeration Company (PRC) can borrow funds at an interest rate of 10.20% for a period of four years. Its marginal federal-plus-state tax rate is 45%. PRC's after-tax cost of debt is (rounded to two decimal places) 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 $1,495.56 per bond, carry a coupon rate of 10%, and distribute annual coupon payments. The company incurs a federal-plus-state tax rate of 45%. 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 1.94% O 2.48% O 2.59% O 2.16%