Problembdj co wants to issue new 25-year bonds for some, Ask an Expert

Finance

Problem:

BDJ Co. wants to issue new 25-year bonds for some much-needed expansion projects. The company currently has 7.8 percent coupon bonds on the market that sell for $1,125, make semiannual payments, and mature in 25 years.

Required:

Question 1: What coupon rate should the company set on its new bonds if it wants them to sell at par? Provide all calculation and methods.

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Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M91146902

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