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Tim Horton wants to raise funds to open a branch of their coffee shop in Trinidad. To raise the funds, Tim Horton would sell bonds
Tim Horton wants to raise funds to open a branch of their coffee shop in Trinidad. To raise the funds, Tim Horton would sell bonds 100 $1,000 par value with a coupon interest rate of 6%. The bonds would mature in 15 years and interest would be paid semi-annually. The required rate of return is expected to be 8%.
Requirement: a) Calculate the value of one bond b) What is the total amount Tim Horton would raise if all bonds were sold?
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