Estimating Cost of Debt Capital

Assume that a company's financial statements report that its average outstanding debt totals $$1\mathrm{.}5$ billion, and its total interest expense equals $$120$ million. If its tax rate is $35\%,$ compute its cost of debt capital.

Round answer to two decimal places $($ex: $0\mathrm{.}02345=2\mathrm{.}35\%)$

$\%$