The Moonlight Mile Corporation wants to issue $1,000,000 of new bonds. Their bonds will have a coupon rate of 8% paid semiannually, will have 30 years to maturity, will have a par value of $1,000, and have a yield to maturity of 7%. How many bonds should Moonlight Mile sell in order to raise $1,000,000
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- KIC Inc. plans to issue $5.0 million of bonds with a coupon rate of 10 percent paid semiannually and 30 years to maturity. The current one-year market interest rate on these bonds is 9 percent. In one year, the interest rate on the bonds will be either 12 percent or 6 percent with equal probability. Assume investors are risk neutral. If the bonds are non-callable, what is the price of the bonds today?Setrakian Industries needs to raise $99.4 million to fund a new project. The company will sell bonds that have a coupon rate of 6.02 percent paid semiannually and that mature in 25 years. The bonds will be sold at an initial YTM of 6.82 percent and have a par value of $2,000. How many bonds must be sold to raise the necessary funds? O 99,400 bonds O 181,154 bonds O 54,939 bonds 68,674 bonds A Moving to another question will save this response. Question 19 of 30Corso Inc. wants to raise $10 million by issuing 15-year zero coupon bonds with a face value of $1,000. Their investment banker informs them that investors would use a 11.25% discount rate on such bonds. At what price would these bonds sell in the market place assuming semiannual compounding? How many bonds would the firm have to issue to raise $10 million?
- To expand its business, Laris Company would like to issue a bond with par value of $1,000, coupon rate of 15%, and maturity of 20 years from now. What is the value of the bond if the required rate of return is 12%? (Interest is paid annually)Setrakian Industries needs to raise $71.8 million to fund a new project. The company will sell bonds that have a coupon rate of 5.78 percent paid semiannually and that mature in 25 years. The bonds will be sold at an initial YTM of 6.46 percent and have a par value of $2,000. How many bonds must be sold to raise the necessary funds?Seabiscuit Industries needs to raise $51.23 million to fund a new project. The company will sell bonds that have a coupon rate of 5 percent paid semiannually and that mature in 15 years. The bonds will be sold at an initial YTM of 7.25 percent and have a par value of $2,000. How many bonds must be sold to raise the necessary funds? 32,168 O 35,202 32,089 O 20,734 20,549
- Harbor Inc. wants to raise $80 million by issuing 10-year zero-coupon bonds at an annual interest rate of 5.4%. What should be the total face value of the bonds (in $ million)?Engro Foods Pakistan wants to generate Rs. 1,500,000,000/- through issuance of bonds in Pakistan stock exchange at a cost of capital of 14.5% annually. The bonds will mature in 15 years. Suppose the prevailing average market rate is 12.5%. and the bond’s par value is Rs. 10,000/-. At what price the bond will be issued? Justify your finding with appropriate rationale.Thatcher Corporation’s bonds will mature in 10 years. The bonds have a face value of $1,000 and an 8 percent coupon rate, paid semiannually. The price of the bond is $1,100. What is the firm’s cost (percentage rate) of borrowing money under these market conditions?
- Global Exporters wants to raise $31.3 million to expand its business. To accomplish this, it plans to sell 15-year, $1,000 face value, zero coupon bonds. The bonds will be priced to yield 6.5 percent. What is the minimum number of bonds it must sell to raise the money it needs? Assume semiannual compounding. 69,800 86,029 81,705 O 74,907 O 73,255XYZ Inc. is a company that is considering issuing bonds to finance the expansion of its activities. The managers thought about bonds with 10 or 15 years to maturity, with a coupon rate of 6%, paid semiannually. The face value of those bonds would be $1,000 and theywould expect those bonds to pay just as much as investors require, being sold at par at the issuance date. Suppose that an investor is interested in the company’s bonds, and they expect that the interest rates (YTM) are going to change immediately, decreasing by 2 percentage points compared to the YTM at issue. Which maturity bond would be better for this investor, the 10 or 15-year? What would be the dollar gain per bond with the expected immediate YTM change in each case?Microsoft plans to issue $10 million of bonds with a coupon rate of 8 percent, a par value of $1,000, semiannual coupons, and 30 years to maturity. The current market interest rate on these bonds is 10 percent. In three year, the interest rate on the bonds will be either 12 percent, 10 percent or 8 percent with equal probability. If the bonds are noncallable, what is the price of the bonds today? (Assume investors are risk-neutral)