David Abbot is buying a new house, and he is taking out a 30-year mortgage David will borrow $192,000 from a bank and to repay the loan he will 360 monthly payment (principal and interest) of $1,220.14 per month over the next 30 years. David can deduct interest payments on his mortage from his taxable income, and based on his income, David is in the 30% tax bracket. A. What is the before-tax interest rate (per year) on Davids loan? B. What is the after-tax interest rate that David is paying?

Before-tax cost of debt and after-tax cost of debt David Abbot is buying a new and interest) of $1,220.14 per month over the next 30 years. David can deduct inte a. What is the before-tax interest rate (per year) on David's loan? b. What is the after-tax interest rate that David is paying? a a. The before-tax interest rate (per year) on David's loan is %. (Round to two de