Assume that the Blackmores Group would like to replace its bank loan facilities (2019) with a new issuing of bonds. Assume that the issue will have a coupon rate of 1.5% with a 10-year maturity. Assume these are semi-annual coupon bonds and each has a face value of $1.000 and the required rates of return for similar bonds in the market is 2.5%. What would be the issuing price of these bonds? How many bonds Blackmores will have to issue in order to replace its bank facilities?

Assume that the Blackmores Group would like to replace its bank loan facilities (2019) with a new issuing of bonds. Assume that the issue will have a coupon rate of 1.5% with a 10-year maturity. Assume these are semi-annual coupon bonds and each has a face value of $1.000 and the required rates of return for similar bonds in the market is 2.5%. What would be the issuing price of these bonds? How many bonds Blackmores will have to issue in order to replace its bank facilities?

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter6: Fixed-income Securities: Characteristics And Valuation

Section: Chapter Questions

Problem 20P

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