Can someone please show me the breakdown of how to do this?

If a corporation has an average tax rate of 40 percent, the approximate annual, after-tax cost of debt for a 10-year, 8 percent, $1,000 par value bond selling at $1,150 is

(a) 3.6 percent.

(b) 4.8 percent.

(c) 6 percent.

(d) 8 percent.

Answer: A