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Several years ago the Haverford Company sold a $1,000 par value bond that now has 25 years to maturity and an 8.00% annual coupon that

Several years ago the Haverford Company sold a $1,000 par value bond that now has 25 years to maturity and an 8.00% annual coupon that is paid quarterly. The bond currently sells for $900.90, and the companys tax rate is 40%. What is the component cost of debt before adjusted for tax?

A. 5.41%

B. 9.01%

C. 5.73%

D. 5.98%

E. 9.55%

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