Musico Corp is a small entertainment company that has zero-coupon bonds outstanding. The bonds will mature in 13 years, and are currently trading at $480 (the par value is $1000). Given a corporate tax rate of 34%, and assuming that the company does not have any other debt, whats the companys after-tax cost of debt?

Select one:

a. 3.83%

b. 4.73%

c. 5.81%

d. 4.11%

e. 4.80%