Question
In: Finance
The Garcia Company’s bonds have a face value of $1,000, will mature in 10 years, and...
The Garcia Company’s bonds have a face value of $1,000, will mature in 10 years, and carry a coupon rate of 19.0 percent. Assume interest payments are made semiannually.
a. Determine the present value of the bond’s cash flows if the required rate of return is 19.0 percent. (Round factor value calculations to 5 decimal places, e.g. 0.52755. Round other intermediate calculations to 2 decimal places, e.g. 52.75. Round final answer to nearest dollar amount.) !!!!!ANSWER IS $1,000!!!!
b. How would your answer change if the required rate of return is 11.1 percent? (Round factor value calculations to 5 decimal places, e.g. 0.52755. Round other intermediate calculations to 2 decimal places, e.g. 52.75. Round final answer to nearest dollar amount.)
Solutions
jeff jeffy answered 2 years agoRelated Solutions
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%
What is their nominal yield to call? Do not round intermediate
calculations. Round your answer to two decimal places.
%
What return should investors expect to...
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