State Inc. decides to issue 10% annual coupon bonds with a maturity of 20 years....
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Finance
State Inc. decides to issue 10% annual coupon bonds with a maturity of 20 years.
Using $1,000 as the face value, what should you pay for this bond if the yield to maturity is 12%? If 10%? If 8%? If 6%. Explain the results.
Instead, they decide to borrow $50 million from a bank with a maturity of 5 years. If the interest rate is 8%, what is the monthly payment? What is the balance at the end of 28 months?
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