Jiminys Cricket Farm issued a 30-year, 6 percent semiannual bond three years ago. The bond currently sells for 93 percent of its face value. The book value of the debt issue is $95 million. In addition, the company has a second debt issue on the market, a zero coupon bond with eight years left to maturity; the book value of this issue is $40 million, and the bonds sell for 67 percent of par. The companys tax rate is 22 percent.

What is your best estimate of the aftertax cost of debt?