Viserion, Inc., is trying to determine its cost of debt. The firm has a debt issue

outstanding with 27 years to maturity that is quoted at 96 percent of face value. The

issue makes semiannual payments on an annual coupon of 7 percent.

a. What is the company's pretax cost of debt? (Do not round intermediate calculations

and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

b. If the tax rate is 21 percent, what is the aftertax cost of debt? (Do not round

intermediate calculations and enter your answer as a percent rounded to 2 decimal

places, e.g., 32.16.)