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Mbi's $1000 par value bonds pay 8% annual coupon, paid semi annual, have remaining maturity of 20 yrs and trade at a price of $1220.

Mbi's $1000 par value bonds pay 8% annual coupon, paid semi annual, have remaining maturity of 20 yrs and trade at a price of $1220. The corporate income tax rate is 30%. What is the before tax cost of debt?

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