A company wants to issue a bond of $500mn and thinks - based on a very poor estimate - it can pay a coupon of 4% to investors. The company has revenues of $100mn., an EBIT (operating) margin of 20% and current interest payments of $10mn. The current base rate is 2%. Please answer the questions: 1) Is the assumed coupon of 4% fair? 2) If not: what is a fair coupon for the company? Please answer by completing all answer boxes in the solutions template, and by giving brief verbal or numerical explanations of your calculations. Dunstion 2: Cost of Debt [Please insert your Question 2 verbalnumerical explanations of your results here. Extend the length of the lext box as much as necessary] A company wants to issue a bond of $500mn and thinks - based on a very poor estimate - it can pay a coupon of 4% to investors. The company has revenues of $100mn., an EBIT (operating) margin of 20% and current interest payments of $10mn. The current base rate is 2%. Please answer the questions: 1) Is the assumed coupon of 4% fair? 2) If not: what is a fair coupon for the company? Please answer by completing all answer boxes in the solutions template, and by giving brief verbal or numerical explanations of your calculations. Dunstion 2: Cost of Debt [Please insert your Question 2 verbalnumerical explanations of your results here. Extend the length of the lext box as much as necessary]