Solution-How many of the zeroes would you need to issue

How many of the zeroes would you need to issue

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Suppose your company needs to raise $46 million and you want to issue 25-year bonds for this purpose. Assume the required return on your bond issue will be 7 percent, and you're evaluating two issue alternatives: A semiannual coupon bond with a 7 percent coupon rate and a zero coupon bond. Your company's tax rate is 30 percent. Assume a par value of $1,000. How many of the zeroes would you need to issue?

Reference no: EM132724307

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How many of the zeroes would you need to issue

Reference no: EM132724307

Reference no: EM132724307

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