The Q corporation will next period realize a project that will have value either 100 or 20.
Question:
The Q corporation will next period realize a project that will have value either 100 or 20. This project is the only assets that Q corporation have. Q has issued a bond with face value of 50, due next period. The risk free interest rate is 10% and the current value of equity in Q is 40. Determine the current value of the bond.
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Related Book For 
Lectures On Corporate Finance
ISBN: 9789812568991
2nd Edition
Authors: Peter L Bossaerts, Bernt Arne Odegaard
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