(Cost of debt) Tellington Inc. recently discussed issuing a 30-year-maturity bond issue with the firm's investment banker. The firm was advised that it would have to pay 4.00 to 4.50 percent on the bonds. Using information in the popup window, B. what does this rate suggest to you about the firm's default rating? The firm's default rating is estimated to be about (Select the best choice below.) i Data Table - X O A Aa2/AA or Aa3/AA-. O B. Baa3/BBB - or Ba1 / BB+. O C. B3/B- or Caa/CCC+. OD. AZIA or A3/A- 5 yr 0.76 0.96 1.16 120 1.23 1.40 Corporate Bond Yields: Default Ratings and Term to Maturity Rating 1 yr 2 yr 3 yr Aaa/AAA 0.22 0.31 0.42 Aa1/AA+ 0.26 0.43 0.58 Aa2/AA 0.29 0.55 0.74 A3/AA- 0.31 0.58 0.77 A1/A+ 0.32 0.60 0.80 A2/A 0.55 0.80 0.98 AWA- 0.62 0.95 1.18 Baa1/BBB+ 1.19 1.42 Baa2/BBB 1.00 1.39 1.65 Baa3/BBB- 1.49 1.87 2.11 Ba 1/BB+ 2.27 2.64 2.90 Ba2/BB 3.04 3.41 3.68 /BB- 3.82 4.18 4.47 B1/B 4.60 4.95 5.25 B2/B 5.38 5.72 6.04 B3/B- 6.15 6.49 6.82 Caa/CCC+ 6.93 7.28 7.61 U.S. Treasury Yield 0.18 0.25 0.32 0.83 1.66 1.91 2.17 2.62 3.41 4.21 5.00 7 yr 1.26 1.46 1.66 1.70 1.73 1.89 2.19 2.45 2.73 3.16 3.98 4.79 5.61 6.42 7.24 8.06 8.87 1.00 10 yr 2.00 2.17 2.35 2.39 2.43 2.57 2.92 3.18 3.48 3.91 4.75 5.58 8.42 726 8.10 8.93 9.77 1.59 30 yr 3.41 3.62 3.83 3.88 3.93 4.03 4.51 4.80 5.17 5.56 6.37 7.19 8.00 8.82 9.63 10.45 11.26 2.78 5.79 6.59 7.38 Click to select your answer. 8.17 0.60