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(Cost of Debt) CougarCo has the option to issue 15-year bonds at $1,300 flotation cost of 7% and a coupon rate of 6% (paid annually)

(Cost of Debt) CougarCo has the option to issue 15-year bonds at $1,300 flotation cost of 7% and a coupon rate of 6% (paid annually) with a face value of $1,000. What is CougarCo firms cost of debt prior to tax?

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