Titan Mining Corporation has 9.6 million shares of common stock outstanding, 400,000 shares of 6 percent preferred stock outstanding, and 210,000 of 8.4 percent semiannual bonds outstanding, par value $1,000 each. The common stock currently sells for $44 per share and has a beta of 1.30, the preferred stock currently sells for $94 per share, and the bonds have 20 years to maturity and sell for 115 percent of face value. The market risk premium is 8.4 percent, T-bills are yielding 4 percent, and the companys tax rate is 40 percent. What is the pre-tax cost of debt?

		8%
		7%
		9%
		5%
		9%