The Dunley Corp. plans to issue 5-year bonds with YTM=4.5%. It believes the bonds will have a BBB rating. Given the following information: Rating: AAA AA A BBB BB B CCC CC-C Default Rate: Average 0.0% 0.1% 0.2% 0.5% 2.2% 5.5% 12.2% 14.1% In Recessions 0.0% 1.0% 3.0% 3.0% 8.0% 16.0% 48.0% 79.0% Source: "Corporate Defaults and Recovery Rates, 1920-2011," Moody's Global Credit Policy, February 2012. *Average rates are annualized based on a 10-year holding period; recession estimates are based on peak annual rates. Assuming an expected 50% loss rate in the event of default during average economic times. If it were a recession, assuming the bond yield will increase by 20% and the expected loss rate is 71% at