Mudvayne is trying to determine its cost of debt. The firm has a debt issue outstanding with 18 years to maturity that is quoted at 107% of face value. The issue makes semiannual payments and has an embedded cost of 6% annually. What is the company's pretax cost of debt? If the tax rate is 35%, what is after tax cost of debt?

Settlement: 01/01/00

Marturity: 01/01/18

Price%: 107

Coupon Rate: 6%

Payment per year: 2

Tax Rate: 35%