BBB Consider the following information regarding corporate bonds: Rating AAA Average Default Rate 0 Average Beta 0.03 0.009 0.22 Company XYZ plans to issue 10-year bonds that it believes will have a BBB rating. Suppose AAA bonds with the same maturity have a 2.7% yield. Assume that the market risk premium is 5.5% and the expected loss rate in the event of default on BBB bonds is 68.6%. The yield that the BBB bonds will have to pay is closest to: a. 5.67% O b. 3.49% O c. 4.36%. O d. 3.05%