1. Regency Motorworks is planning to raise $250 million through a new 7-year debt issue. Its investment bankers have proposed two alternatives: (i) a domestic issue yielding 6.25% and (ii) a Eurobond issue yielding 6.40%. The two debt issues have identical terms other than the interest rate. Which debt issue will provide the lower cost of debt? Justify your answer. 2. Suppose a private equity fund has $100 million in total committed capital and its investors have