Luther Industries needs to raise $25 million to fund a new office complex. The company plans on issuing

tenminusyear

bonds with a face value of $1,000 and a coupon rate of 7.0% (annual payments). The following table summarizes the YTM for similar

tenminusyear

corporate bonds of various credit ratings:

Rating	AAA	AA	A	BBB	BB
YTM	6.70%	6.80%	7.00%	7.40%	8.00%

What rating must Luther receive on these bonds if they want the bonds to be issued at par?

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Suppose Compco Systems pays no dividends but spent $5.09

billion on share repurchases last year. If Compco's equity cost of capital is 12.2%,

and if the amount spent on repurchases is expected to grow by 8.6%

per year, estimate Compco's market capitalization. If Compco has 5.1

billion shares outstanding, to what stock price does this correspond?

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Ursula wants to buy a $22,000

used car. She has savings of $2,000 plus an $800 trade-in. She wants her monthly payments to be about

$319.

Which of the following loans offers monthly payments closest to

$319?