Question: Tiny Tots has debt outstanding, currently selling for $820 per bond. It matures in 16 years, pays interest annually, and has a 11% coupon rate.

Tiny Tots has debt outstanding, currently selling for $820 per bond. It matures in 16 years, pays interest annually, and has a 11% coupon rate. Par is $1000, and the firm's tax rate is 25%. What is the after-tax cost of debt? The after-tax cost of debt for Tiny Tots is nothing%. (Round to two decimal places.)

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