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Debbie Downer Ditch Diggers has debt outstanding currently selling for $1,100. It matures in 10 years, pays interest annually, and has a 10% coupon payment.

Debbie Downer Ditch Diggers has debt outstanding currently selling for $1,100. It matures in 10 years, pays interest annually, and has a 10% coupon payment. Par is $1,000 and the firms tax rate is 40%. What is the after-tax cost of debt?

After-tax cost of debt = % (Round your answer to two decimal places.)

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