David Abbot is interested in purchasing a bond issued by Sony. He has obtained the following information on the security:

SONY BOND

Par Value $1000 Coupon Interest Rate 6% Tax bracket 20%

Cost $ 920 Years to maturity 10

Answer the following questions.

a. calculate the before-tax cost of the Sony bond using the bonds yield to maturity (answer must be %)

b. Calculate the after-tax cost of the Sony bond given the corporate tax bracket.

In order to get full points you must answer first and show your work. Thanks!!