1. A firm decided to raise funds by issuing ₱1,000 bonds a coupon rate of 6% paid semi – annually and the principal to be paid at maturity 5 years from now. If the current Yield to Maturity is at 8% and the firm issues 10,000 contracts, how much could be raised? 2. A stock who just declared a dividend of ₱2/share is currently valued at ₱60/share. The firm is anticipated to grow by 10% every year starting this year for the next 5 years, and then constantly from then on. Given this information and that required rate of return for the stock is 8%, what is the assumed rate for the firm?
1. A firm decided to raise funds by issuing ₱1,000 bonds a coupon rate of 6% paid semi – annually and the principal to be paid at maturity 5 years from now. If the current Yield to Maturity is at 8% and the firm issues 10,000 contracts, how much could be raised? 2. A stock who just declared a dividend of ₱2/share is currently valued at ₱60/share. The firm is anticipated to grow by 10% every year starting this year for the next 5 years, and then constantly from then on. Given this information and that required rate of return for the stock is 8%, what is the assumed rate for the firm?
Advanced Engineering Mathematics
10th Edition
ISBN:9780470458365
Author:Erwin Kreyszig
Publisher:Erwin Kreyszig
Chapter2: Second-order Linear Odes
Section: Chapter Questions
Problem 1RQ
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1. A firm decided to raise funds by issuing ₱1,000 bonds a coupon rate of 6% paid semi – annually and the principal to be paid at
maturity 5 years from now. If the current Yield to Maturity is at 8% and the firm issues 10,000 contracts, how much could be raised?
2. A stock who just declared a dividend of ₱2/share is currently
valued at ₱60/share. The firm is anticipated to grow by 10% every
year starting this year for the next 5 years, and then constantly
from then on. Given this information and that required rate of
return for the stock is 8%, what is the assumed rate for the firm?
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