What is the firm before-tax cost of debt

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A firm uses only debt and equity in its capital structure. The firm's weight of equity is 75%. The firm's cost of equity is 16% and it has a tax rate of 30%. If the firm's WACC is 13%, what is the firm's before-tax cost of debt?

6.89%
6.28%
5.97%
5.71%

Reference no: EM13269578

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