Suppose your company needs to raise $54 million and you want to issue 25-year bonds for...

Suppose your company needs to raise $54 million and you want to issue 25-year bonds for this purpose. Assume the required return on your bond issue will be 4.8 percent, and you’re evaluating two issue alternatives: A semiannual coupon bond with a coupon rate of 4.8 percent and a zero coupon bond. Your company’s tax rate is 25 percent. Both bonds will have a par value of $1,000.

b-2.	What if you issue the zeroes? (Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, e.g., 1,234,567.)
c.	Calculate the aftertax cash flows for the first year for each bond. (Do not round intermediate calculations and enter your answers in dollars, not millions of dollars, e.g., 1,234,567.)

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Suppose your company needs to raise $54 million and you want to issue 25-year bonds for...

Suppose your company needs to raise $54 million and you want to issue 25-year bonds for this purpose. Assume the required return on your bond issue will be 4.8 percent, and you’re evaluating two issue alternatives: A semiannual coupon bond with a coupon rate of 4.8 percent and a zero coupon bond. Your company’s tax rate is 25 percent. Both bonds will have a par value of $1,000. a-1. How many of the coupon bonds would you need to issue...

Suppose your company needs to raise $54 million and you want to issue 25-year bonds for...

Suppose your company needs to raise $54 million and you want to issue 25-year bonds for this purpose. Assume the required return on your bond issue will be 4.8 percent, and you’re evaluating two issue alternatives: A semiannual coupon bond with a coupon rate of 4.8 percent and a zero coupon bond. Your company’s tax rate is 25 percent. Both bonds will have a par value of $1,000. a-1. How many of the coupon bonds would you need to issue...

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Suppose your company needs to raise $54 million and you want to issue 25-year bonds for...

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