MGFD70H3 Lecture Notes - Lecture 17: Tax Shield, Net Present Value, Regional Specialized Meteorological Center
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,973 owe to the bank after 3 years. ,975 owe to the bank after 2 years. Using approximation formula and the above equation r = ytm = 14% The following time line illustrates the years to maturity of the bond. Use the following procedure to determine the bond price: find the price of the bond on july 1, 2030. . 87: add the coupon , to the bond price to get the total value (tv) of the bond on the next payment date. . 87: discount this total value back to the purchase date. . 72: you should write a cheque for . 72. Of this amount = (1/3) represents accrued interest, and . 72 represents the bond"s basic value. This breakdown affects your taxes and those of the seller. Effective d1 is (4. 7411/4. 4)-1 = 7. 75% more than the nominal dividend. Price of the stock will rise by ,818,182/400,000 =
