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A $1,000 face value corporate bond with a 6.75 percent coupon (paid semiannually) has 10 years left to maturity. It has had a credit rating of BB and a yield to maturity of 8.2 percent. The firm recently became more financially stable and the rating agency is upgrading the bonds to BBB. The new appropriate discount rate will be 7.1 percent. What will be the change in the bond's price in dollars and percentage terms? (round to 3 decimal places)3) You plan to purchase an $80,000 house using a 15-year mortgage obtained from your local bank. The mortgage rate offered to you is 8.00 percent. You will make a down payment of 20 percent of the purchase price. (LG 7-4)Calculate your monthly payments on this mortgage.Calculate the amount of interest and, separately, principal paid in the 127th payment.Calculate the amount of interest and, separately, principal paid in the 159th payment.Calculate the amount of interest paid over the life of this mortgage.4)You plan to purchase a $150,000 house using a 15-year mortgage obtained from your local credit union. The mortgage rate offered to you is 5.25 percent. You will make a down payment of 20 percent of the purchase price. (LG 7-4)Calculate your monthly payments on this mortgage.Construct the amortization schedule for the first six payments.10) You plan to purchase a house for $175,000 using a 15-year mortgage obtained from your local bank. You will make a down payment of 25 percent of the purchase price and monthly payments. You will not pay off the mortgage early. (LG 7-3)Your bank offers you the following two options for payment:Option 1: Mortgage rate of 5 percent and zero points.Option 2: Mortgage rate of 4.75 percent and 2 points.Which option should you choose?Your bank offers you the following two options for payments:Option 1: Mortgage rate of 4.85 percent and 2 points.Option 2: Mortgage rate of 4.68 percent and 3 points.Which option should you choose?1) Suppose a firm has 15 million shares of common stock outstanding and six candidates are up for election to five seats on the board of directors. (LG 8-1)If the firm uses cumulative voting to elect its board, what is the minimum number of votes needed to ensure election to the board?If the firm uses straight voting to elect its board, what is the minimum number of votes needed to ensure election to the board?2)Suppose you own 50,000 shares of common stock in a firm with 2.5 million total shares outstanding. The firm announces a plan to sell an additional 1 million shares through a rights offering. The market value of the stock is $35 before the rights offering and the new shares are being offered to existing shareholders at a $5 discount. (LG 8-3)If you exercise your preemptive rights, how many of the new shares can you purchase?What is the market value of the stock after the rights offering?What is your total investment in the firm after the rights offering? How is your investment split between original shares and new shares?If you decide not to exercise your preemptive rights, what is your investment in the firm after the rights offering? How is this split between old shares and rights?
Determine the cash flows associated with calculating the present value of preferred stock and the cash flows associated with calculating the present value of common stock?
time value comparisons of single amounts-in exchange for a 20000 payment today a well known company will allow you to
What is BBB's economic value added (EVA) for the current year?
ICU Window, Inc., is trying to determine its cost of debt. The firm has a debt issue outstanding with seven years to maturity that is quoted at 114 percent of face value. The issue makes semiannual payments and has an coupon rate of 9.8 percent an..
Sweet Tooth Bakery bakes and sells pies. Sweet Tooth has annual fixed costs of $880,000 and a variable cost per pie of $7.50. Each pie sells for $15.50 each. The firm expects to sell 500,000 pies annually. What is the break-even point in pies?
How do SMERF groups complement the business travel market?
Chris is planning for her son's college education to begin five years from today.
The asset is to be used in a five-year project; at the end of the project, the asset can be sold for $175,000. If the relevant tax rate is 35 percent, what is the aftertax cash flow from the sale of this asset?
Pluralism, state autonomy, and elitism are three theories of U.S. policy making. Pluralism focuses on power of individuals, state autonomy on bureaucracies, and elitism on effect of elites in society.
1) Using Harvey's four quadrant model, illustrate and describe the possible effects on nominal GDP, the exchange rate E, employment N and interest rates r of a tightening of monetary policy in a country. 2) There is overshooting in this model, but it..
last year you purchased a stock at a price of 76.00 a share. over the course of the year you received 2.40 in dividends
If the only violation of the M&M assumptions is that investors face one tax rate for interest income and another tax rate for equity income, what is the implication for the optimal capital structure of a corporation?
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