Compute the contract services division's cost of debt capital using the 1 year-treasury (Table B) and the credit spread given in Table A. (enter as a percent and round to two decimals (i.e. X.XX%), do not include the % sign).

Table B U.S. Government Interest Rates, April 1988
Maturity	Rate
30-year	8.95%
10-year	8.72
1-year	6.90

Table A Market Value-Target Leverage Ratios and Credit Spreads for Marriott and Its Divisions
	Debt Percentage in Capital	Fraction of Debt at Floating	Fraction of Debt at Fixed	Debt Rate Premium above Government
Marriott	60%	40%	60%	1.30%
Lodging	74	50	50	1.10
Contract services	40	40	60	1.40
Restaurants	42	25	75	1.80