Use this table from our textbook in answering the next problem:

Table 12.3 Average Debt Betas by Rating and Maturity*

By Rating	A and above	BBB	BB	B	CCC
Avg. Beta	<0.05	0.10	0.17	0.26	0.31
By Maturity	(BBB and above)	1-5 year	5-10 year	10-15 year	>15 year
Avg. Beta	Blank	0.01	0.06	0.07	0.14

A company has outstanding bonds with 10 years left to maturity with a yield to maturity of 7% and a BB rating. If the risk-free rate is 3% and the market risk premium is 4%, estimate the expected return on the companys debt.