The Pulp Company Has a 9-Year Bond Outstanding with a 7.5

The Pulp Company has a 9-year bond outstanding with a 7.5 % coupon. Coupons are paid semi-annually. The face amount of the bond is $1,000. This bond is currently selling for 96 % of its face value. What is the company's pre-tax cost of debt?

A) 6.85 %
B) 7.19 %
C) 7.50 %
D) 8.14 %
E) 8.59 %