Shanken Corp. issued a 30-year, 9 percent semiannual bond 6 years ago. The bond currently sells for 105 percent of its face value. The companys tax rate is 35 percent. The book value of the debt issue is $21 million. In addition, the company has a second debt issue on the market, a zero coupon bond with six years left to maturity; the book value of this issue is $84 million and the bonds sell for 80 percent of par.

What is your best estimate of the aftertax cost of debt?