In the following financial data, the firm has a before-tax cost of debt of 6.0%, a cost of equity of 12.1%, and a marginal tax rate of 21%. The firm also has 50 percent debt and 50 percent equity. Using the weighted average cost of capital formula (WACC), calculate the after-tax cost of capital.
Group of answer choices
7.1 percent
8.42 percent
9.0 percent
5.9 percent