Suppose your project is worth $140 with a probability of 60.0% and $84 with a probability of 40.0%. The appropriate cost of capital is 0.1 for the overall project. If you want to raise $92.4 today and promise to bond investors a rate of return of 0.07, what's the expected rate of return of this bond?

Answer rating: 100% (QA)

To calculate the expected rate of return of the bond we need to consider ... View the full answer