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KatyDid Clothes has a $110 million (face value) 25-year bond issue selling for 102 percent of par that carries a coupon rate of 8 percent,

KatyDid Clothes has a $110 million (face value) 25-year bond issue selling for 102 percent of par that carries a coupon rate of 8 percent, paid semiannually.

What would be KatyDid's before-tax component cost of debt? (Round your answer to 2 decimal place

The answer is not 3.92% or 8%

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