Current cost of a bond you know that the after-tax cost of

Assignment Help Finance Basics
Reference no: EM13347840

Current cost of a bond:

You know that the after-tax cost of debt capital for Bubbles Champagne is aprox. to 7 percent. If the firm has only single issue of five-year maturity bonds outstanding, what is the current price of the bonds if the coupon rate on these bonds is 10 percent? Suppose the bonds make semiannual coupon payments and the marginal tax rate is 30 percent.

1. Pre-tax cost of debt capital = %.

2. Current price of the bonds = $ .

Reference no: EM13347840

Questions Cloud

Write a program which has a base process which communicates : write a program which has a base process which communicates with child processes acting as bombers that it
Part 1aig is often called the largest insurance entity in : part 1a.i.g. is often called the largest insurance entity in the world. a.i.g.s total assets were 860 billion on
You are working as a financial analyst for apple inc apple : you are working as a financial analyst for apple inc. apple inc. is one of the most innovative companies worldwide.
Memory location 2000h has the word 5000h stored in it what : memory location 2000h has the word 5000h stored in it. what does each location contain after inc byte ptr2000h. also
Current cost of a bond you know that the after-tax cost of : current cost of a bond you know that the after-tax cost of debt capital for bubbles champagne is aprox. to 7 percent.
You are the supervisor on the audit of platinum pokienbsp : you are the supervisor on the audit of platinum pokienbsp club a large suburban club in western australia. as well as
Part aace company has a 30 percent marginal tax rate and : part aace company has a 30 percent marginal tax rate and uses a 12 discount rate to compute npv. the firm started a
You have been asked by your 56 year old auntmary to help : you have been asked by your 56 year old auntmary to help her assess a new venture. it is friday night and she needs the
Part iusing the data provided on the webvista site in the : part iusing the data provided on the webvista site in the file marked vdw.txt try to develop a mathematical equation

Reviews

Write a Review

Finance Basics Questions & Answers

  How do the business cycles and the health of economy affect

How do the business cycles and the health of the economy affect the value of your labor? In terms of supply and demand, what are the optimal conditions in which to sell your labor? How might further education increase your mobility in the labor ma..

  What was the cash flow from operating activity

W.C Cycling had $55,000 in cash at year-end 2013 and $25,000 in cash at year-end 2014. The firm invest in property, plant, and equipment totaling $250,000. Cash flow from financing activities totaled + $170,000.

  Compound annual rate of return

Suppose you are 25 years old and inherit $65,000 from your grandmother. If you wish to purchase a $100,000 yacht to celebrate your 30th birthday,

  Calculation of market value of the firm

Calculation of market value of the firm and The marginal corporate tax rate is 34% and Firm C has a dividend pay-out ratio of 20% and a dividend growth rate of 8%

  What is the year 1 cash flow

What is the Year 1 cash flow? Equipment cost (depreciable basis) $65,000 Sales revenues, each year $60,000 Operating costs (excl. deprec.) $25,000 Tax rate 35.0% Answer $30,258 $31,770 $33,359 $35,027 $36,778

  What is the projected operating cash flow for this project

The fixed costs for this project are $42,000, depreciation is $11,000 a year, and the tax rate is 33 percent. What is the projected operating cash flow for this project?

  Which of the following statements regarding mortgage-backed

Which of the following statements regarding mortgage-backed securities (MBS) and collateralized mortgage obligations (CMOs) is most correct.

  The possible explanations for these patterns

Dorchester, Inc has asked you to help forecast exchange rates for China, Korea and Japan.

  What is the risk-free rate of return

Cell Tower stock has a current market price of $43 a share. The one-year call on Cell Tower stock with a strike price of $44.5 is priced at $3 while the one-year put with a strike price of $44.5 is priced at $1. What is the risk-free rate of retur..

  Finding interest expenses

200,000 in assets to get into operation with only two financing alternatives 1. 2.50 percent equity and 50% debt. you will put the entire 200,000 required to purchase the assets

  Determine the year 1 cash flow

As a member of UA company's financial staff, you must estimate the Year one cash flow for a proposed project with the following information.

  What is the annual cost - depreciation and interest costs

A used car costs $ 120 000. car can be sold for $ 10 000 after six years. What is the annual cost (depreciation and interest costs) if the discount rate is 9%?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd