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)	94.6	x	$ 16.36		$ 1547.66
Alaska Air Group (ALK)	123.4	x	$ 61.96		$ 7645.86
Yum! Brands (YUM)	332.5	x	$ 85.13		$ 28,305.73
Caterpillar Tractor (CAT)	147.4	x	$ 597.63		$ 88,090.66
Microsoft (MSFT)	7,705.00	x	$ 91.27		$ 703,235.35

1. The price of Yum! Brands' stock has risen to $185. What is the market value of the firms equity if the number of outstanding shares does not change? (Enter your answer in billions rounded to 3 decimal places.)

Market value____________

B. The rating agency has revised Catalytic Concepts bond rating to A (use Table 2.2). What interest rate, approximately, would the company now need to pay on its bonds? (Enter your answer as a percent rounded to 1 decimal place.)

Interest rate _________%

Credit Rating Interest Rate <----- Table 2.2

AAA 3.5%

AA 3.5

A 3.8

BBB 4.3

BB 5.1

B 6.5