Consider the table shown below to answer the question posed in part a. Parts b and c are independent of the given table.

	Number of Share (millions)		Stock Price	=	Market Capitalization ($ millions)
Callaway Golf (ELY)	94.2		27.30	=	$ 2,572
Alaska Air Group (ALK)	123.7		50.70	=	$ 6,272
Yum! Brands (YUM)	301.7		103.07	=	$ 31,096
Caterpillar Tractor (CAT)	543.3		186.66	=	$ 101,412
Microsoft (MSFT)	7,560		242.12	=	$ 1,830,427

The price of Yum! Brands stock has risen to $175. What is the market value of the firms equity if the number of outstanding shares does not change?

Note: Enter your answer in dollars not in billions of dollars.

The rating agency has revised Catalytic Concepts bond rating to BBB (use Table 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.

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?

TABLE 2.2 Interest rates on long-term corporate bonds, October 2020. The interest rate is lowest for top-quality (AAA and AA) issuers. The rate rises as credit quality declines.

Credit Rating	Interest Rate
AAA	1.6%
AA	1.6
A	1.7
BBB	2.4
BB	4.2
B	5.6

Source: ICE Bank of America Merrill Lynch indices.