Question

ABC has two financing alternatives. Calculate APY for each alternative.
a. A publicly placed $20 million bond issue. Issuance costs are $1 million the bonds have a 7% coupon paid SEMI-ANNUAL with a 10-year life.
b. A privately placed $20 million bond issue. Issuance costs are $3 million; the bonds have a 7% ANNUAL coupon rate with a 10-year life.



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  • CreatedJuly 26, 2013
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