Mojo mining has a bond outstanding that sells for $2,174 and matures in 18 years. The bond pays semiannual coupon and has a coupon rate of 7.14 percent. the par value is $2,000. If the company's tax rate is 40 percent what is the aftertax cost of debt?

1. 3.60%

2. 3.79%

3. 6.51%

4. 4.13%

5. 6.32%