Question: Use the option data from the table to determine the rate Buffin would have paid if it had issued $ 105.22 billion in zero-coupon debt

Use the option data from the table to determine the rate Buffin would have paid if it had issued $ 105.22 billion in zero-coupon debt due in January 2017. Suppose Buffin currently had 300.64 million shares outstanding, implying a market value of $ 122.61 billion. The current two-year risk-free rate is 4.50 %. (Assume perfect capital markets.)

The yield on the Buffin debt is?

BUFN 405.85-11.85 Dec 05, 2014 (Closing) Vol 10311740 en Int Calls Bid Ask 17 Jan 300.0 (BVC AT-E) 17 Jan 310.0 (BvC AB-E) 17 Jan 320.0 (BVC AD-E) 17 Jan 330.0 (BVC AF-E) 17 Jan 340.0 (BVC AH-E) 17 Jan 350.0 (BVC AJ-E) 17 Jan 360.0 (BVC AL-E) 17 Jan 370.0 (BVC AN-E) 17 Jan 380.0 (BVC AU-E) 17 Jan 390.0 (BVC AV-E) 17 Jan 400.0 (BVC AW-E) 17 Jan 410.0 (BVC AX-E) 353 157.60 160.20 151.10 153.90 201 144.80 147.80 220 141.90 214 138.70 166 136.10 132.90 130.40 209 127.20 124.90 121.70 196 116.40 119.50 380 114.40 123 111.40 106.50 165 109.50 104.60 102.00 1131 214 97.30 100,00 BUFN 405.85-11.85 Dec 05, 2014 (Closing) Vol 10311740 en Int Calls Bid Ask 17 Jan 300.0 (BVC AT-E) 17 Jan 310.0 (BvC AB-E) 17 Jan 320.0 (BVC AD-E) 17 Jan 330.0 (BVC AF-E) 17 Jan 340.0 (BVC AH-E) 17 Jan 350.0 (BVC AJ-E) 17 Jan 360.0 (BVC AL-E) 17 Jan 370.0 (BVC AN-E) 17 Jan 380.0 (BVC AU-E) 17 Jan 390.0 (BVC AV-E) 17 Jan 400.0 (BVC AW-E) 17 Jan 410.0 (BVC AX-E) 353 157.60 160.20 151.10 153.90 201 144.80 147.80 220 141.90 214 138.70 166 136.10 132.90 130.40 209 127.20 124.90 121.70 196 116.40 119.50 380 114.40 123 111.40 106.50 165 109.50 104.60 102.00 1131 214 97.30 100,00

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