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the second photo was not a part of the first photo B Suppose your company needs to raise $40.2 million and you want to issue

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the second photo was not a part of the first photo
B Suppose your company needs to raise $40.2 million and you want to issue 25-year bonds for this purpose. Assume the required return on your bond issue will be 5.2 percent, and you're evaluating two issue alternatives: a 5.2 percent semiannual coupon bond and a zero coupon bond. Your company's tax rate is 22 percent. anys tax rate is 22 per ook a. How many of the coupon bonds would you need to issue to raise the $40.2 million? How many of the zeroes would you need to issue? (Do not round Intermediate calculations. Round your coupon bond answer to the nearest whole number, e.g., 32 and your zero coupon bond answer to 2 decimals, e.g., 32.16.) b. In 25 years, what will your company's repayment be if you issue the coupon bonds? What if you issue the zeroes? (Do not round Intermediate calculations and enter your answers in dollars, not millions, rounded to the nearest whole number, e.g., 1,234,567.) c. Assume that the IRS amortization rules apply for the zero coupon bonds. Calculate the firm's aftertax cash outflows for the first year under the two different scenarios. (Input a cash outflow as a negative value and a cash inflow as a positive value. Do not round intermediate calculations and enter your answers in dollars, not millions, rounded to 2 decimal places, e.g., 1,234,567.89.) of mans ce a. Number of coupon bonds Number of zero coupon bonds b. Coupon bond repayment Zero coupon bond repayment c. Coupon bond cash flow Zero coupon bond cash flow NJCU Blackboard Ultra The Art of Mind Map Question 7 - Chapter 06 - Interest. figure 6.3.jpg 842x623 pixels U.S. Treasury Quotes Treasury note and bond data are representative over-the-counter quotations as of 3 p.m. Eastern time. FIGURE Sample Wall Journal U.S. note and bo Asked Yleld Maturity Coupon Bid Asked Chg 1/31/2019 12/31/2021 1/31/2022 2/28/2023 9/30/2023 2/29/2024 7/31/2024 1/31/2025 4/30/2025 11/15/2026 2/15/2029 5/15/2030 2/15/2036 5/15/2037 11/15/2039 5/15/2040 8/15/2041 5/15/2042 2/15/2043 2/15/2044 8/15/2046 5/15/2047 5/15/2048 1.500 2.125 1.500 2.625 1.375 2.125 2.125 2.500 2.875 6.500 5.250 6.250 4.500 5.000 4.375 4.375 3.750 3.000 3.125 3,625 2.250 3.000 3.125 99.5469 97.8906 95.6563 99.2109 92.7969 96.1172 95.7344 97.6328 99.8359 126.6406 120.9453 132.8984 120.9375 129.0938 121.3047 121.5313 111.6875 99.1875 101.1641 110.0313 84.6797 98.7578 101.1875 99.5625 97.9063 95.6719 99.2266 92.8125 96.1328 95.7500 97.6484 99.8516 126.6563 121.0078 132.9609 121.0000 129.1563 121.3672 121.5938 111.7500 99.2188 101.1953 110.0625 84.7109 98.7891 101.2188 -0.0078 0.0703 0.0547 0.1172 0.1172 0.1484 0.1172 0.1953 0.2109 0.3125 0.4063 0.4688 0.5625 0.6641 0.6953 0.7500 0.7500 0.7266 0,7344 0.6875 0.6016 0.6953 0.7422 2.205 2.749 2.762 2.801 2.847 2.864 2.887 2.892 2.899 2.906 2.941 2.949 2.964 2.973 3.014 3.021 3.040 3.046 3.056 3.056 3.064 3.063 3.062 r Source: www.wsj.com, 6/14/2018

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