Jack's Audio has a yield to maturity on its debt of $7\mathrm{.}5$ percent, a cost of equity of $12\mathrm{.}4$ percent, and a cost of preferred stock of $8$ percent. If the tax rate is $30$ percent, what is the cost of debt?

$9\mathrm{.}04\%$

$7\mathrm{.}23\%$

$5\mathrm{.}25\%$