, 7 years ago, the City of Calabasas issued $5,000,000 of 10.5% coupon, 20-year annual payment, tax-exempt muni bonds. The bonds had 5 years of call protection, but now the bonds can be called if the city chooses to do so. The call premium would be 6.5% of the face amount. New 13-year, 8.5%, annual payment bonds can be sold at par, but flotation costs on this issue would be 4%, of the amount of bonds sold, what is the net present value of the refunding? Note that cities pay no in are not relevant come taxes, hence taxes

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to calculate the net present value NPV of the refunding for the City of Calabasas 1 Costs of Refundi... View the full answer