Afirm has a credit rating of aa. you notice that the credit spread for 10-year maturity aa debt is 90 basis points (0.90%). your firm’s ten-year debt has a coupon rate of 5% paid semiannually. you see that new ten-year treasury notes are being issued at par with a coupon rate of 4.5%. what should the price of your outstanding ten-year bonds be? the bond’s face value is $100.

Jamie is saving for a trip to europe. she has an existing savings account that earns 3 percent annual interest and has a current balance of $4,200. jamie doesn’t want to use her current savings for vacation, so she decides to borrow the $1,600 she needs for travel expenses. she will repay the loan in exactly one year. the annual interest rate is 6 percent. a. if jamie were to withdraw the $1,600 from her savings account to finance the trip, how much interest would she forgo? .b. if jamie borrows the $1,600 how much will she pay in interest? c. how much does the trip cost her if she borrows rather than dip into her savings?