Avicorp has a $\backslash (\backslash$$ $12\mathrm{.}4\backslash )$ million debt issue outstanding, with a $\backslash (5\mathrm{.}9\backslash \%\backslash )$ coupon rate. The debt has semi$-$annual coupons, the next coupon is due in six months, and the debt matures in five years. It is currently priced at $\backslash (93\mathrm{.}11\backslash \%\backslash )$ of par value.

a$.$ What is Avicorp's pretax cost of debt?

b$.$ If Avicorp faces a $\backslash (40\backslash \%\backslash )$ tax rate, what is its after$-$tax cost of debt? Note: Assume that the firm will always be able to utilize its full interest tax shield.

a$.$ The cost of debt is

$\backslash (\backslash \%\backslash )$ per year. $($Round to two decimal places.$)$

b$.$ If Avicorp faces a $\backslash (40\backslash \%\backslash )$ tax rate, the after$-$tax cost of debt is

$\backslash \%.($Round to two decimal places.$)$