Question: Look back at Table 7-4 and examine United Parcel Service and Telecom Italia Capital bonds that mature in 2013. a. If these companies were to

Look back at Table 7-4 and examine United Parcel Service and Telecom Italia Capital bonds that mature in 2013.
a. If these companies were to sell new $1,000 long-term bonds, approximately what interest rate would they have to set if they wanted to bring them out at par?
b. If you had $10,000 and wanted to invest in United Parcel Service bonds, what return would you expect to earn? What about Telecom Italia Capital bonds? Based just on the data in the table, would you have more confidence about earning your expected rate of return if you bought United Parcel Service or Telecom Italia Capital bonds? Explain.

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