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Q1) A Limited has just issued a bond with face value of $1000 and a coupon rate of 8%. If the bond has a life
Q1) A Limited has just issued a bond with face value of $1000 and a coupon rate of 8%. If the bond has a life of15 years, pays annual coupons and the YTM is 7.5%, what will the bond sell for?
Q2) Given thatpreference shares have an expected dividend stream of 20 cents in perpetuity and that the current market price (cum-dividend) of thepreference shares is $2.40, calculate the cost ofcapital(kp)of these preference shares.
Please provide working out. Thank you!
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