Business Finance
Autor: charlotteb84 • April 14, 2015 • Essay • 307 Words (2 Pages) • 842 Views
Page 1 of 2
Business Finance I
First exercise :
New fields Tech is in need of 340.000,00 euros
- they’ll issue zero coupon bonds and coupon bonds to raise this required capital equally proportional, both bonds face value 1.000,00 euros
- coupon bonds, 4 years maturity, semi annual coupon rate is 8%
- ZCB, 21 months maturity
- Estimated required rate by investors is 21% for coupon bonds and an additional 2% for zero coupon bonds
Bank loan
Pv = debt Fv tend to be 0
Rate = expressed yearly
Maturity = periodicity n per year
C’est la fonction PMT, en francais
= how should we pay per period
Second exercise :
buy a truck for our distribution company | |
price is 31,000 euros | |
la caixa may fund this by a 14% rate loan | |
5 years, quarterly payments | |
what if we wish "killing" this debt on year 4?? |
Investing in bonds in a company
- company goes bankrupt, i will receive nothing
- company is making average performance, decent return, i will receive FValue
- invest in company, outsanding performace, i will receive FValue
repo contract = the company issuing the shares offers to the shareholders that he can resell his shares after a certain time if he’s not satistied with them.
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