$**$ ANSWER BOTH PART A AND PART B$!**$

flotation costs and the cost of debt In March of $2020$ PepsiCo, Inc. $($PEP$)$ sold $$750$ million worth of $30-$year $5\mathrm{.}00\%$ coupon bonds that pay semi$-$annual interest. At the time the bonds were issued, the

market paid $$1,009\mathrm{.}26$ per bond and the flotation cost was $$17\mathrm{.}56$ per bond. Pepsi's corporate tax rate is $21\%.$

a$.$ Ignoring flotation costs, what is Pepsi's before$-$tax and after$-$tax costs of debt?

b$.$ Considering flotation costs, what is Pepsi's before$-$tax and after$-$tax costs of debt?

a$.$ Ignoring flotation cost, Pepsi's before$-$tax cost of debt is $\%.($Round to two decimal places.$)$