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Mid States Company is a regional chain department store. It will remain in business for one more year. The probability of a boom year is

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Mid States Company is a regional chain department store. It will remain in business for one more year. The probability of a boom year is 70 percent and the probability of a recession is 30 percent. It is projected that the company will generate a total cash flow of $187 million in a boom year and $78 million in a recession. The company's required debt payment at the end of the year is $112 million. The market value of the company's outstanding debt is $85 million. The company pays no taxes. What payoff do bondholders expect to receive in the event of a recession? (Do not a. round intermediate calculations and enter your answer in dollars, not millions of dollars, rounded to the nearest whole dollar, e.g., 1,234,567.) What is the promised return on the company's debt? (Do not round intermediate b. calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) What is the expected return on the company's debt? (Do not round intermediate c. calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

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