Ying Import has several bond issues outstanding, each making semiannual interestpayments. The bonds are listed in the following table.Bond1234CouponRate Price Quote5.1%6.7Cost of debt6.65.9104.86113.62112.17101.41Maturity5 years8 years15.5 years25 years%Face Value$If the corporate tax rate is 24 percent, what is the aftertax cost of the company's debt?(Do not round intermediate calculations and enter your answer as a percent roundedto 2 decimal places, e.g., 32.16.)59,000,00054,000,00074,000,00081,000,000

The entire face amount of all bonds that have been issued but have not yet reached their individual…

Ying Import has several bond issues outstanding, each making semiannual interest payments. The bonds are listed in the following table. Bond 1 2 3 4 Coupon Rate Price Quote 5.1% 104.86 6.7 113.62 6.6 112.17 5.9 101.41 Maturity 5 years 8 years 15.5 years 25 years Face Value $ 59,000,000 54,000,000 74,000,000 81,000,000 If the corporate tax rate is 24 percent, what is the aftertax cost of the company's debt? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Ying Import has several bond issues outstanding, each making semiannual interest payments. The bonds are listed in the following table. Bond 1 2 3 4 Coupon Rate Price Quote 5.1% 104.86 6.7 113.62 6.6 112.17 5.9 101.41 Maturity 5 years 8 years 15.5 years 25 years Face Value $ 59,000,000 54,000,000 74,000,000 81,000,000 If the corporate tax rate is 24 percent, what is the aftertax cost of the company's debt? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Ying Import has several bond issues outstanding, each making semiannual interest payments. The bonds are listed in the following table. Coupon Bond Rate Price Quote Maturity Face Value $ 1 6.4% 106.36 6 years 44,000,000 234 7.9 114.92 9 years 39,000,000 7.6 113.47 16.5 years 59,000,000 7.2 102.71 26 years 66,000,000 If the corporate tax rate is 24 percent, what is the aftertax cost of the company's debt? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Cost of debt %
Desert Trading Company has issued $100 million worth of long-term bonds at a fixed rate of 10%. The firm then enters into an interest rate swap where it pays SOFR and receives a fixed 5.2% on notional principal of $100 million. What is the firm's effective interest rate on its borrowing? Note: Enter value as positive amount. Round your answer to 1 decimal place. Effective interest rate %
A Corporation has a bond with a par value of $2,000 that sells for $1,900. The bond has a coupon rate of 6.45 percent and matures in 15 years. If the bond makes semiannual coupon payments, what is the YTM of the bond? O 5.45% O 6.99% O 6.54%
Moerdyk Corporation's bonds have a 25-year maturity, a 7.25% semiannual coupon, and a par value of $1,000. The going interest rate (rd) is 8.20%, based on semiannual compounding. What is the bond's price? a. $937.23 Ob.$918.85 Oc. $689.14 Od. $899.68 Oe. $854.53
A bond with $898,000 face value that pays 10% coupon is issued at 102 1/2, i.e., 102.5% of its face value. Is this bond issues at premium of discount? And what is the amount of cash received as a result of issuing this bond? a. Premium; $920,450 b. Discount; $673,500 c. Premium; $987,800 d. PAR Value; $898,000 A B C D
(Bond relationship) Mason, Inc. has two bond issues outstanding, called Series A and Series B, both paying the same annual interest of $80. Series A has a maturity of 12 years, whereas Series B has a maturity of 1 year. a. What would be the value of each of these bonds when the going interest rate is (1) 6 percent, (2) 11 percent, and (3) 14 percent? Assume that there is only one more interest payment to be made on the Series B bonds. b. Why does the longer-term (12-year) bond fluctuate more when interest rates chavoe than does the shorter-term (1-vear) hond?
Kk.428.
Ying Import has several bond issues outstanding, each making semiannual interest payments. The bonds are listed in the table below. Bond Coupon Rate Price Quote Maturity Face Value 1 8.50% 106.0 5 years $19,000,000 2 6.50 94.4 8 years 39,000,000 3 8.20 104.8 15.5 years 44,000,000 4 8.70 94.6 25 years 59,000,000 If the corporate tax rate is 25 percent, what is the aftertax cost of the company’s debt? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
A bond issued by the State of Pennsylvania provides a 5.75% yield. What yield on a Synthetic Chemical Company bond would cause the two bonds to provide the same after-tax rate of return to an investor in the 35.00% tax bracket? (Round your final answer to two decimal places.) O a. 3.74% O b. 7.76% O c. 8.85% O d. 4.26% O e. 16.43%
Brooks Books’ bonds have 13 years remaining to maturity. Interest is paid annually; they have a $1,000 par value; the coupon interest rate is 8 percent; and the yield to maturity is 7.5 percent. What is the bond’s current market price? a. $1,000.00 b. $980.72 c. $1,040.63 d. $650.07 e. $1,080.00
Please keep at least 2 decimal points for dollar amounts and at least 4 significant digits for rates. Question 1 Knick Inc. has two bonds outstanding, and both pay semi-annual coupons. The first bond has 18 years to maturity, 16% coupon rate, and $720,000 face value. It is trading at 110 (110% of face value). The second bond has 10 years to maturity, 8% coupon rate, and $880,000 face value. It is trading at 13.5% YTM. Knick has 150,000 shares outstanding with beta of 1.25. The expected dividend per share is $4 next year and will grow at 2% per year. The market return is 15% and the risk-free rate is 3%. Corporate tax is 25%. a) Calculate the cost of equity and the equity value. b) Calculate the after-tax cost of debt. c) Calculate the WACC. d) Estimate the unlevered beta. e) Assume that Knick changes its debt-to-equity ratio to 0.2 and its cost of debt decreases 40 bps, estimate its new cost of equity and WACC.
Ying Import has several bond issues outstanding, each making semiannual Interest payments. The bonds are listed in the following table. If the corporate tax rate is 31 percent, what is the aftertax cost of Ying's debt? (Do not round your intermediate calculations.) Bond Coupon Rate Price Quote 102 111 103 116 1234 4 6.3% 7 6.1 6.8 4.19% 5.78% 3.79% 3.83% 3.99% Maturity 7 years 12 years 21.5 years 32.5 years Face Value $ 21,000,000 40,000,000 47,000,000 58,000,000

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