Question
Dunder-Mifflin, Inc. (DMI) is selling 600,000 bonds to raise money for the publication of new magazines in the coming year. The bond will pay a
Dunder-Mifflin, Inc. (DMI) is selling 600,000 bonds to raise money for the publication of new magazines in the coming year. The bond will pay a coupon rate of 14.1% with semiannual payments and will mature in 30 years. Its par value is $100. What is the cost of debt to DMI if the bonds raise the following amounts (ignoring issuing costs)?
a. What is the cost of debt to DMI if the bonds raise $57,858,000 ___ % (Round to two decimal places) b. What is the cost of debt to DMI if the bonds raise $52,008,000 ___ % (Round to two decimal places) c. What is the cost of debt to DMI if the bonds raise $61,236,000 ___ % (Round to two decimal places) d. What is the cost of debt to DMI if the bonds raise $73,578,000 ___ % (Round to two decimal places)
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