Sunrise, Incorporated, is trying to determine its cost of debt. The firm has a debt issue outstanding with $24$ years to maturity that is quoted at $102$ percent of face value. The issue makes semiannual payments and has an embedded cost of $7$ percent annually.

$1.$ What is the company's pretax cost of debt?

$2.$ If the tax rate is $25$ percent, what is the aftertax cost of debt?