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Holiday Movies Inc. has two bond issues outstanding with the following data: Bond Issue A           ...

Holiday Movies Inc. has two bond issues outstanding with the following data:

Bond Issue A            Bond Issue B

Face Value                                    1000                                   1000

Current Price                                97                                      102    

Coupon Rate                                  5%                                     7%

Payable                                         Annually                             Semiannually

Years to maturity                          6                                        12

# Outstanding                              2000                                  6000

What is the yield to maturity on Bond A? ______________

What is the yield to maturity on Bond B? ______________

What is the market value weight (percentage) on Bond A? _____________

What is the market value weight (percentage) on Bond B? _____________

What is the weighted average cost of debt? _____________

Solutions

Expert Solution

Calculation for each part is shown below

Working is given below

jeff jeffy answered 1 year ago
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