Engineers at a semiconductor company developed an improved front-end-of-line (FEOL)formulation process that requires an investment of $8.9 million. The company plans to issue$8.9 million worth of 10-year bonds that will pay interest of 8.8% per year, payable annually.If the company's effective tax rate is 38%, what is the after-tax cost (i.e., interest rate) ofthe debt financing? (Obtain the answers by hand.)

The after-tax cost of the debt financing is %.