Company YY has this balance sheet ($MM):

Assets

Cash 5

AR 10

Net PPE 15

Total Assets 30

Liabilities

Accounts Payable (AP) 5

Accrued Salary 5

Bond maturing in 10 years, with IRR = 5%: 10

Loan due in 3 years, with IRR = 10%: 5

Long term Pension Liabilities 5

Total Liabilities 20

Equity 10

What is closest to the company's weighted average, pre-tax cost of debt capital, r_{D, tot}?

7.5%

0.006667

6.67%

This cannot be computed without knowing the interest rate of the firm's AP liabilities.

0.75