Question
Instruction: Read the case study related to East Coast Yachts and complete the following tasks. After Dans analysis for East Coast Yachts (see the Case
Instruction: Read the case study related to East Coast Yachts and complete the following tasks.
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- How many of the coupon bonds must East Coast Yachts issue to raise the $50 million? How many of the zeroes must it issue? You must show all your works for the full credits.
- In 20 years, what will be the principal repayment due if East Coast Yachts issues the coupon bonds? What if it issues the zeroes? You must show all your works for the full credits.
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- Assuming the company continues its current growth rate, what is the value per share of the companys stock? You must show all your works for the full credits.
Step 1: Find total earnings
Step 2: Find payout ratio
Step 3: Find retention ratio
Step 4: Find growth ratio
Step 5: Find total equity value
Step 6: Find value per share
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