After-tax cost of debt For the following

$1,000-par-value

bond, assuming annual interest payment and a

21%

tax rate, calculate the after-tax cost of

debt.

(Click on the icon here

in order to copy the contents of the data table below into a spreadsheet.)

Life	Underwriting fee	Discount () orpremium (+)	Coupon interest rate
20 years	$25	$20	9%

Question content area bottom

Part 1

The after-tax cost of financing using the approximation formula is