Walter's Distributors has a cost of equity of 13.84% and an unlevered cost of capital of 12%.The company has $5,000 in debt that is selling at par value.The levered value of the firm is $12,000 and the tax rate is 34%.What is the pre-tax cost of debt?
A)7.92%
B)8.10%
C)8.16%
D)8.84%
E)9.00%

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The Answer of Walter's Distributors has a cost of equity of 13.84% and an unlevered cost of capital of 12%.The company has $5,000 in debt that is selling at par value.The levered value of the firm is $12,000 and the tax rate is 34%.What is the pre-tax cost of debt?
A)7.92%
B)8.10%
C)8.16%
D)8.84%
E)9.00%

Walter's Distributors Has a Cost of Equity of 13