e. Your case company has an issue of $1,000 par value annual coupon bonds with 6 years remaining until maturity. The annual coupon rate is given in Table 1, along with the current price of the bonds. What is the yield to maturity on the bonds? f. Your company has an issue of $100 par value bonds that offer a 5% coupon rate paid semi-annually. The bonds have 4 years remaining until maturity. The markets required return on these bonds is given in Table

Table 1: Case company data (hypothetical except where noted) Beacon Lighting (BLX) Super Retail (SUL) $891.00 $11,500.00 $247.70 $2,711.40 9.90% 5.30% 5.45%, monthly 6.00%, semi- annually Harvey Breville Adairs Norman Nick Scali (BRG) (ADH) (HVN) (NCK) Payment per $4,359.00 $2,050.00 $15,897.00 $536.00 month Annual total revenue $760.00 $344.40 $2,234.10 $268.00 ($millions) Annual growth in total 10.70% 15.50% 8.10% 12.40% revenue Loan A (APR, 3.02%, 4.26%, 3.93%, 2.48%, compounding semi- semi- monthly quarterly frequency) annually annually Loan B 4.00%, (APR, 2.85%, 2.45%, 4.25%, semi- compounding monthly daily3 quarterly annually frequency) Loan C(APR, 2.52%, 3.91%, 2.95%, 4.24%, compounding semi- daily quarterly daily frequency) annually Property cost $1,540,000 $2,910,000 $9,950,000 $760,000 6 year bond annual coupon 5.15% 4.35% 3.95% 4.90% rate 6 year bond $1,111.50 $956.60 $1050.50 $980.95 current price 4 year bond required rate of 3.40% 4.90% 4.80% 4.10% return 1 Data from S&P Capital iQ for the company's most recent financial year. 2 Most recent 5 year historical CAGR from S&P Capital IQ 3 Assume a 365-day year 5.50%, semi- annually 5.95%, monthly 5.40%, daily 5.97% quarterly $840,000 $1,650,000 5.85% 4.55% $922.00 $1,077.00 5.80% 3.90%