Business
Business, 17.04.2020 18:51, alexdonatalex1314

Bad Wolf Enterprises issues $8 million in 8.250% bonds maturing February 15, 2032. The bond is callable February 15, 2024 at a call premium of 12.000%. February 15, 2024 the prevailing yield is 1.500%. If Bad Wolf Enterprises calls the entire issue and replaces it with 1.500% bonds also maturing February 15, 2032 then
Each semi-annual coupon payment will decrease by ?
The present value of the decrease in coupon payments is ?
The principal repayment at maturity will increase by ?
The present value of the increase in the principal repayment is ?
The present value of this decision to the company - to the nearest dollar - is ?
The company should (CALL / NOT CALL) ?

answer
Answers: 3

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Bad Wolf Enterprises issues $8 million in 8.250% bonds maturing February 15, 2032. The bond is calla...

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