Icu window inc is trying to determine its cost of debt the, Ask an Expert

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ICU Window, Inc., is trying to determine its cost of debt. The firm has a debt issue outstanding with eight years to maturity that is quoted at 116.5 percent of face value. The issue makes semiannual payments and has an embedded cost of 10.8 percent annually.

What is ICU's pretax cost of debt?

If the tax rate is 35 percent, what is the aftertax cost of debt?

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