Gregoris plc has some loan notes, currently quoted at 104 per 100 nominal value. These will pay

Question:

Gregoris plc has some loan notes, currently quoted at £104 per £100 nominal value.

These will pay interest at the rate of 8 per cent p.a. of the nominal value at the end of each of the next four years and repay £100 at the end of four years.

What is the cost of the loan notes? (Ignore taxation.)

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Business Finance

ISBN: 9781292134406

11th Edition

Authors: Eddie McLaney

See More Books

Question Posted: Mar 05, 2024 06:38 AM

See More Questions

Doverdale plc has some convertible loan notes, with a current market value of 109 per 100 nominal value, on which it will pay interest at the rate of 12 per cent on their nominal value in one years...
Hazelwood plc is financed by: (a) 1 million ordinary shares (nominal value 1 each). These are expected to yield a dividend of 0.10 per share in one years time. Dividends are expected to grow by 10...
Hatleigh plc is an engineering business. The financial statements for the year ended 30 April Year 8 are as follows: A dividend of 600,000 was proposed and paid during the year. The business made a...
Consider a beam with two perpendicular segments subjected to a concentrated load as shown in Fig. 9.52. Using two beam elements, determine the deflection and stresses in the two segments of the beam....
In the following graph, each dot represents a particular country's initial level of real GDP per capita and its growth rate of real GDP per capita. a. For the range of initial GDP per capita from 0...
An investor buys a 30-year bond with a $1,000 face value for $950. The bond's coupon rate is 5 percent and interest payments are made semi-annually. Using the YTM (yield to maturity) approximation...
We will see in Chapter 8 that the pressure drop in fully developed pipe flow is sometimes computed with the aid of a friction factor, defined by \[ f=\frac{\Delta p}{\frac{1}{2} ho V^{2}}...
In Problem 12.7 on page 424, you used the plate gap on the bag sealing equipment to predict the tear rating of a bag of coffee. Perform a residual analysis for these data (stored in Starbucks). Based...
In November, Trinity Donuts incurred $8850 in total costs related to the production of 3500 donuts. In December, Trinity incurred $8600 in total costs. Total fixed costs are $1850 per month. By how...
Skylar and Walter Black have been married for 25 years. They live at 883 Scrub Brush Street, Apt. 52B, Las Vegas, NV 89125. Skylar is a stay-at-home parent and Walt is a high school teacher. His W-2...
Loan notes that were originally issued at par are currently quoted in the capital market at 93 per 100 nominal value. Repayment of the nominal value in full is due in exactly five years time....
What determines the value of an economic asset (as opposed to an asset that has value for reason of sentiment)?
A recruit can join the semi-secret "300 F" club at the Amundsen-Scott South Pole Station only when the outside temperature is below 70oC. On such a day, the recruit first basks in a hot sauna and...
Account for the apparent mismatch between the rationale for strategic recruitment and selection and the paucity of evidence of its practice.
Metal Corporation owns all of the stock of Iron Corporation, and owns 100 shares of Steel Corporation, which has 1,000 shares of stock outstanding. The 100 shares of Steel were purchased by Metal in...
An individual files an income tax return for the calendar-year 2017 on September 20, 2018, and pays $1,200, which is the balance of the tax due. Disregarding interest, how much in delinquency...
Why might organisations choose a top-down approach to cultural re-alignment?
Salkey Company has two owners, Gus and Jack, who are father and son. Gus owns 100 shares which he acquired in 2013 for $\$ 15,000$. Jack owns 100 shares which he acquired in 2015 for $\$ 21,000$....
Blackwell Hats Corporation uses workers in Indonesia to manually weave straw hats. The company pays the workers a daily base wage plus $0.25 per completed hat. On Monday, workers produced 100 hats...
Why are stocks usually more risky than bonds?
What is meant by the expression committed cost? How do committed costs arise?
Following a sensitivity analysis, it appears that the success of Project X depends on the actual cost of raw materials not exceeding 10 per cent of their projected cost. It also depends on the actual...
Lombard Ltd has been offered a contract for which there is available production capacity. The contract is for 20,000 identical items, manufactured by an intricate assembly operation, to be produced...
Three capacitors are connected to a DC battery (with an electric potential difference of V between a and b) as shown in Figure. Given: C1 C2 C3 C (F) C (F) C3 (F) V (Volt) 53 75 31 18 Find the...
How do you handle a new project or task at work, home, or school? How do you embrace working in groups when you prefer to work independently? How would you react to your instructor's suggestion to...
Authority is given to the school governing bodies of South African public schools to determine the school's Language of Learning and Teaching (LoLT). Provide a critical evaluation of this statement...

Gregoris plc has some loan notes, currently quoted at 104 per 100 nominal value. These will pay

Question:

Step by Step Answer:

Gregoris plc 8 8 8 108 104 1k 1k 1k 1 k This looks like a r...View the full answer

Business Finance

Students also viewed these Business questions