Viserion, Incorporated, is trying to determine its cost of debt. The firm has a debt issue outstanding with 17 years to maturity that is quoted at 108 percent of face value. The issue makes semiannual payments and has an embedded cost of 5 percent annually.

What is the company's pretax cost of debt?

4.33%

5.20%

3.42%

4.76%

3.90%

If the tax rate is 21 percent, what is the aftertax cost of debt?

3.42%

3.08%

3.76%

4.79%

4.33%