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How much cash would deere have to pay to repurchase

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1. How much cash would Deere have to pay to repurchase the 7.125% notes at the quoted market price of 135.13. (Assume no interest is owed when Deere repurchases the notes.) (Round your answer to two decimal places.)

Assume Deere & Company's 2012 10-K reports the following footnote relating to long-term debt. Deere's borrowings include $350 million, 7.125% notes, due in 2031 (bolded below).

Long-term borrowings at October 31 consisted of the following in millions of dollars:

7.85% debentures due 2015 $ 306 $ 306
6.95% notes due 2019: ($700 principal) Swapped to variable interest rates of 6.1%-2012, 6.4%-2011 743 734
8.95% debentures due 2019 56 56
8-1/2% debentures due 2022 105 105
6.55% debentures due 2028 200 200
8.10% debentures due 2030 200 200
7.125% notes due 2031 350 350
Other notes 13 18
Total $ 1,973 $ 1,969

A recent price quote (from Yahoo! Finance Bond Center) on Deere's 7.125% notes follows.

Corp Deere & CO 135.13 7.125 3-Mar-2031 4.588 5.273 A No

This price quote indicates that Deere's 7.125% notes have a market price of 135.13 (135.13% of face value), resulting in a yield to maturity of 4.588%.

Reference no: EM131813693

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