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Category > Business & Finance Posted 07 Jun 2017 My Price 9.00

. The bonds are listed in the following table. If

Ying Import has several bond issues outstanding, each making semiannual interest payments. The bonds are listed in the following table. If the corporate tax rate is 34 percent, what is the aftertax cost of Ying's debt? (Do not round your intermediate calculations.)
NOTE: YTM is given as a decimal, so 0.05 is 5%. Get the market values and then take a market value-weighted average of the YTM. Please note that bond prices are quoted as a percent of par value (or face value). So if you see a price of 98, that means the market value is 98% of the face value. Don't forget to adjust for tax once you have the weighted average YTM, and leave the YTM as an APR.

Bond

Coupon Rate

Price Quote

Maturity

 YTM (quoted as decimal, not %)

Face Value
1 6.3%      108      5 years        0.045 $ 23,000,000   
2 7.4%         117      9 years        0.0503 $41,000,000   
3 6.4%         109      21 years        0.0566 $42,000,000   
4 7.7%         123      33 years        0.0608 $62,000,000   
 

3.64%

3.5%

5.52%

3.46%

3.83%

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Status NEW Posted 07 Jun 2017 07:06 AM My Price 9.00

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