table 2.2

Problem 2-18 Functions of Financial Markets (LO3) Consider the table shown below to answer the question posed in part a. Parts b and c are independent of the given table. a. The price of Yum! Brands stock has risen to $180. What is the market value of the firm's equity if the number of outstanding shares does not change? Note: Enter your answer in dollars not in billions of dollars. b. The roting agency has revised Cotalytic Concepts' bond rating to A (use Iable 2.2). What interest rate, approximately, would the company now need to pay on its bonds? Note: Enter your answer as a percent rounded to 1 decimal place. c. A farmer and a meatpacker use the commodity markets to reduce their risk. One agrees to buy live cattle in the future at a fixed price, and the other agrees to sell, Which one sells? TABL.F 2.2 Iaterest rates on long-term corporate bonds, October 2020 . The interest rate is lowest for top-quality (AAA and AA) issuers. The rate rises an credit quality declines. Soarce: ICE Banik of America Merrill Lynch indices