A company issues 2,500 bonds with a par value of $200 each. The coupon rate is 6%. How much capital is raised? A) $500,000 B) $530,000 C) $30,000 per year D) $470,000
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- How much capital is raised?You have the following information about a company:Debt: 5,000 3% bonds with twelve years to maturity. The face value of the bond is $1000. The bonds currently sell for $1190 and the bonds make semi-annual paymentsEquity: 125,000 shares outstanding selling for $65 per share. The beta is 1.35. The last dividend paid was $3.25.Market: There is a 5% market risk premium. The risk free rate is 2%. The corporate tax rate is 25%Given the above information, calculate the firm’s WACC.The nominal rate of return is $1,000. % earned by an investor in a bond that was purchased for $904, has an annual coupon of 9%, and was sold at the end of the year for $1031? Assume the face value of the bond is
- A company issues a 5-year, 4% coupon bond with a face value of $100,000. The effective market interest rate at the time of issuance is 2%. What are the proceeds from issuing the bond? $109,427 $109,471 $128,414 $83,778 $100,000 O O O3. Assume you purchased a bond for $9,186. The bond pays $300 interest every six months. You sell the bond after 18 months for $10,000. Calculate the following: a. Income. b. Capital gain (or loss). c. Total return in dollars and as a percentage of the original investment. Review Only Click the icon to see the Worked Solution. a. The current income is $ (Round to the nearest dollar.) b. The capital gain (or loss) is $ (Enter a loss as a negative number and round to the nearest dollar.) c. The total return in dollars is $ (Round to the nearest dollar.) The total return as a percentage of the original investment is %. (Enter as a percentage and round to two decimal places.)A firm raises capital by selling $18,000 worth of debt with flotation costs equal to 3% of its par value. If the debt matures in 10 years and has an annual coupon interest rate of 10%, what is the bond's YTM? (Round to two decimal places.)
- Bacon Signs Inc. has $500,000 outstanding of $1000 par value bonds with a coupon interest rate of 7.5% and 2 0 years to maturity. If Bacon Signs makes semiannual payments, how large is each payment per bond? a. $40.00 b. $75.00 c. $37.50 d. $40.50A corporate bond sells for $990 currently. It has a 6-year maturity, an annual coupon of $75, and a par value of $1,000. What is their capital gains yield? 8.11% 0.14% 9.47% 0.13%A company is going to undertake an issue of $100 million of high yield bonds, with a maturity of 5 years. The bonds are rated BB. The coupon on the bonds is 5%, paid semi-annually. The underwriter is charging a commission of 2%. What is the effective yield on the bonds, from the company's point of view? Group of answer choices 5.46 % 7.00% 5.75% 2.73%
- (a) A bond with 8 years to maturity has a nominal value of NOK 1,000,000. Coupon rates at 3% per year is paid annually. Annual market interest rate is 4%. What is the price of the bond today? (b) A company will issue shares for NOK 20 million. The share capital today is 5 mill. NOK (500,000 shares of NOK 10). The shares are now traded for NOK 50 per share, action. The issue will have a preferential right for old shareholders. The issue price is set at NOK 40 pr. action. What is the theoretical value per, subscription right? (c) The balance sheet for Rotor ASA is shown here in market values. That's 400i million outstanding shares.. The balance sheet (market values in NOK million). Cash 800 Equity 8,500 Fixed Asset 12,000 Debt 4,300 Total 12,800 Total 12,800 The company has announced a dividend of NOK 7.00 per. action. Ex-dividend day is tomorrow. Ignore taxes. What is the market value of Rotor after the dividend payment?ROFL Limited has asked you to calculate the debt component to help in its calculation of its weighted average cost of capital (WACC). ROFL has 2,000 Corporate Bonds outstanding with a face value of $49,000 each. The coupon rate is 4% pa. compounding semi-annually. The bonds mature in 12 years and currently ROFL bonds are trading in the market at a yield of 7%p a. If a coupon payment was paid today what is the total market value of ROFLS issued bonds? Provide your answer to the nearest dollar.Peng Corporation has 100 bonds outstanding with a maturity value of $1,000. The required rate of return on these bonds is currently 10%, and interest is paid semiannually. The bonds mature in five years, and their current market value is $768 per bond. The annual coupon interest rate is 8.12% 6.44% 3.99% 2.64%
