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Help! I've tried different formulas and inputs and I can't seem to figure it out the correct values. Problem 12-18 Calculating Capital Structure Weights [LO
Help! I've tried different formulas and inputs and I can't seem to figure it out the correct values.
Problem 12-18 Calculating Capital Structure Weights [LO 3] Occam Industrial Machines issued 154,000 zero coupon bonds seven years ago. The bonds have a par value of \\( \\$ 1,000 \\) and originally had 30 years to maturity with a yield to maturity of 7.4 percent. Interest rates have recently increased, and the bonds now have a yield to maturity of 8.5 percent. Assume semiannual compounding for the bonds. What is the dollar price of the bonds? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. What is the market value of the company's debt? Note: Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, rounded to 2 decimal places, e.g., 1,234,567.89. If the company has a \\( \\$ 46.9 \\) million market value of equity, what weight should it use for debt when calculating the cost of capital? Note: Do not round intermediate calculations and round your answer to 4 decimal places, e.g., .1616Step by Step Solution
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