Q3 (***) A limited liability firm in a two-period model borrows $100 to invest in a project. The tax rate is 21%, and the risk-free rate between the two periods is 4%. Bond holders are risk-neutral, equity investors are risk-averse, and you are told they think the beta of their payoffs is 3. The ERP is 6%. Project payoffs are: {f(-100)=0.1 ; f(75)=0.2; f(125)=0.2; f(175)=0.2; f(800)=0.3}. (a) What is the YTM of the bond sold by the firm? Q3 (***) A limited liability firm in a two-period model borrows $100 to invest in a project. The tax rate is 21%, and the risk-free rate between the two periods is 4%. Bond holders are risk-neutral, equity investors are risk-averse, and you are told they think the beta of their payoffs is 3. The ERP is 6%. Project payoffs are: {f(-100)=0.1 ; f(75)=0.2; f(125)=0.2; f(175)=0.2; f(800)=0.3}. (a) What is the YTM of the bond sold by the firm