Gillian stationery corporation needs to raise 622000 to, Ask an Expert

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Gillian Stationery Corporation needs to raise $622,000 to improve its manufacturing plant. It has decided to issue a $1,000 par value bond with an annual coupon rate of 7.27 percent with interest paid semiannually and a 10?-year maturity. Investors require a rate of return of 10.4 percent.

a. Compute the market value of the bonds.

b. How many bonds will the firm have to issue to receive the needed? funds?

c. What is the? firm's after-tax cost of debt if the? firm's tax rate is 34 ?percent?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92306357

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