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Please show step-by-step process. Thank you. Allianz is planning to issue a 12-year maturity bond with 30 warrants attached and a bond yield to maturity
Please show step-by-step process. Thank you.
Allianz is planning to issue a 12-year maturity bond with 30 warrants attached and a bond yield to maturity of 2.5%. Each warrant is expected to worth $3. (a) If the coupon rate for this 12-year maturity bond is at 3%, how much capital would Allianz be able to raise for every bond with 20 warrants attached to each share of bond? (b) Suppose Allianz plans to sell each share of this 12-year bond with 30 warrants attached at par value ($1,000) today. What is the coupon rate for this Allianz bond? Allianz is planning to issue a 12-year maturity bond with 30 warrants attached and a bond yield to maturity of 2.5%. Each warrant is expected to worth $3. (a) If the coupon rate for this 12-year maturity bond is at 3%, how much capital would Allianz be able to raise for every bond with 20 warrants attached to each share of bond? (b) Suppose Allianz plans to sell each share of this 12-year bond with 30 warrants attached at par value ($1,000) today. What is the coupon rate for this Allianz bondStep by Step Solution
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