How is equity cost determined under wacc

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1. A 5 year bond (face value =$1000) pays 12% annual coupon if interest rate is 10%, calculate the market value today(i.e. issue date). PV year 1? PV year 2? PV year 3? PV year 4? PV year 5? FV? PV0?

How is equity cost determined under WACC?

2. A few years ago, Spider Web, Inc. issued bonds with a 6.79 percent annual coupon rate, paid semiannually. The bonds have a par value of $1,000, a current price of $762, and will mature in 14 years. What would the annual yield to maturity be on the bond if you purchased the bond today?

Reference no: EM131893603

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