Several years ago the Jakob Company sold a $1,000 par value, noncallable bond that now has 20 years to maturity and a 6.00% annual coupon that is paid semiannually. The bond currently sells for $825, and the company's tax rate is 25%. What is the component cost of debt for use in the WACC calculation? Do not round your intermediate calculations.

a. 6.49%

b. 7.73%

c. 5.80%

d. 3.87%

e. 3.72%