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You want to calculate the cost of debt for a firm with bank debt and long-term bond outstanding. The $100 million revolving line of credit

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You want to calculate the cost of debt for a firm with bank debt and long-term bond outstanding. The $100 million revolving line of credit is priced at Libor + 150 basis points and with $25 million utilized. The company has a $150 million 5-year bond that pays interest semi-annually. The bond has a 6% coupon, $1,000 par value and is currently priced at 101.5 as a percent of par. The Libor reference rate is currently 0.50%. What is the blended average cost of debt for the firm. 4.19% 5.73% 2.50% 5.13%

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