Questions from Corporate Finance

Q: Gabriele Enterprises has bonds on the market making annual payments,

Gabriele Enterprises has bonds on the market making annual payments, with eight years to maturity, a par value of $1,000, and selling for $948. At this price, the bonds yield 5.1 percent. What must th...

Q: Weismann Co. issued 15-year bonds a year ago at a

Weismann Co. issued 15-year bonds a year ago at a coupon rate of 4.9 percent. The bonds make semiannual payments and have a par value of $1,000. If the YTM on these bonds is 4.5 percent, what is the c...

Q: West Corp. issued 25-year bonds two years ago at a

West Corp. issued 25-year bonds two years ago at a coupon rate of 5.3 percent. The bonds make semiannual payments. If these bonds currently sell for 105 percent of par value, what is the YTM?

Q: McConnell Corporation has bonds on the market with 14.5 years

McConnell Corporation has bonds on the market with 14.5 years to maturity, a YTM of 5.3 percent, a par value of $1,000, and a current price of $1,045. The bonds make semiannual payments. What must the...

Q: You find a zero coupon bond with a par value

You find a zero coupon bond with a par value of $10,000 and 17 years to maturity. If the yield to maturity on this bond is 4.2 percent, what is the price of the bond? Assume semiannual compounding per...

Q: The Jackson-Timberlake Wardrobe Co. just paid a dividend of $2.15

The Jackson-Timberlake Wardrobe Co. just paid a dividend of $2.15 per share on its stock. The dividends are expected to grow at a constant rate of 4 percent per year indefinitely. If investors require...

Q: First National Bank charges 13.1 percent compounded monthly on its

First National Bank charges 13.1 percent compounded monthly on its business loans. First United Bank charges 13.4 percent compounded semiannually. As a potential borrower, which bank would you go to f...

Q: After successfully completing your corporate finance class, you feel the

After successfully completing your corporate finance class, you feel the next challenge ahead is to serve on the board of directors of Schenkel Enterprises. Unfortunately, you will be the only person...

Q: In the previous problem, assume that the company uses cumulative

In the previous problem, assume that the company uses cumulative voting, and there are four seats in the current election. How much will it cost you to buy a seat now?Previous problem:After successful...

Q: Colosseum Corp. has a zero coupon bond that matures in

Colosseum Corp. has a zero coupon bond that matures in five years with a face value of $65,000. The current value of the company’s assets is $62,000, and the standard deviation of its return on assets...