Reference no: EM132646712
1. General Mills issued a note on April 17, 2018 with a maturity date of April 17, 2028 (10-year tenor). The face value of the issue was $1,400 million. The bond promised to make 20 semi-annual coupon payments (starting 10.17.2018) at annual rate of 4.200%.
a. At issuance, the note sold at 99.798% of face value. Determine the yield to maturity (YTM) an investor would receive buying the note at issuance under these conditions.
b. The 10-year UST note had a yield on April 17, 2018 of 2.82% (APR). Calculate the default spread on the General Mills note.
c. If the only default risk is that at maturity General Mills repays only 50% of face value (but all coupon payments), determine the market probability of this default event from this pricing spread assuming the risk was random (the expected return in the risk free rate). (Use a 2 outcome model - default or no default)
Assume on October 18, 2020, this bond will be trading with a YTM of 2.38% (APR).
d. With 15 coupon payments remaining, determine the market price on this General Mills note on this day.
|
Significant impact on businesses and industries
: We have viewed how Blockchain has made a significant impact on businesses and industries.
|
|
Construct a one-year binomial tree for project
: Consider the data given in the previous question. We will assume that Technology A has a salvage value of $7 million, rather than zero.
|
|
Determine Yuen tax liability on the distribution
: Assume that the distribution to Yuen is a nonqualified stock redemption. Determine Yuen's tax liability on the distribution
|
|
Emerging Infectious Diseases
: Who is 3 months pregnant, asks to talk to you because she has felt tired for the last 2 days, has a headache, a rash, and does not feel like eating
|
|
Determine the yield to maturity an investor
: General Mills issued a note on April 17, 2018 with a maturity date of April 17, 2028 (10-year tenor). The face value of the issue was $1,400 million.
|
|
Determine the market price of note
: 1. The Treasury offers a $10,000 face value 10-year government note with an annual coupon rate of 1.00% (paid semi-annually) to the market.
|
|
What are the tax issues for Angie estate
: Angie has made gifts during her lifetime to Ann. What are the tax issues for Angie's estate, Ann, and Bluebird
|
|
Awareness of services businesses
: Exercise will heighten your awareness of services businesses and how they perform from the customer's perspective.
|
|
Provide an introduction of the firm
: Provide an introduction of the firm, the industry in which it operates and describe its target market. Evaluate the firm's social media strategy
|