Consider the following information: BB BBB AA AAA Rating 12.2% 5.5% 2.2% 0.45% 0.2% 0.1% 0.0% Average Default Rate 48.0% 16.0% 8.0% 3.0% 3.0% 1.0% Recession Default Rate 0.0% 0.31 0.26 0.17 0.05 0.10 0.05 0.05 Average Beta Debt Rating Total Enterprise Value ($mm) Equity Beta Market Company Capitalization (Smm) Taggart Transcontinental 4500 8000 1.1 BBB Rearden Metal 3800 7200 1.3 AAA Wyatt Oil 2400 3800 0.9 Nielson Motors 1500 4400 1.75 BB What is your estimate of the debt beta for Taggart Transcontinental? What is your estimate of the asset beta for Nielson Motors? Suppose that because of the large need for steel in building railroad infrastructure, Taggart Transcontinental and Rearden Metal decide to form into one large conglomerate. Your estimate of the asset beta for this new conglomerate is closest to: A) 0.42. B) 0.59. C) 0.66. D) 0.68