Question: please show work and formulas on excel for all questions XYZ Co has 1500 units of bonds outstanding. Each unit has $100 face value. 8%

please show work and formulas on excel for all questions

XYZ Co has 1500 units of bonds outstanding. Each unit has $100 face value. 8% coupon rate with semi annual payments, and 15 years to maturity. The risk free rate is 3%, default risk premium for its bond is 2%, maturity risk premium for 15 year maturity is 1.5%, XYZ has a tax rate of 20%.

1. a. Determine the required rate of return for its bonds, b. the amount of tax savings, c. the after tax cost of debt.

2. Determine a. value per unit of bond, B. determine total market value of all bonds outstanding.

3. If risk free rate goes up from 3% to 4% due to inflation, a. what is the new value of each unit of bond? b. what is the rate of change in the value of bond? c. what is the duration of the bond?

XYZ co has 12,000 shares of common stocks. the stock has a standard deviation of return of 25% and the stock index has a standard deviation return of 15%. The correlation coefficient between stock return and stock index return is 0.75. The stock is expected to pay dividend of $4 in one year and $4 in two years. Its expected price in two years is $45, The risk free rate is 3%. The stock market index has an expected return of 12%.

4. a. Estimate the undiversifiable risk of XYZ stock. b. Determine the beta of XYZ stock.

5. Use the security market line or the capital asset pricing model to determine a. the risk premium for stock XYZ and b. the required rate of return of the stock.

6. Determine a. the per share value of the stock and b. the total market value of all stocks.

7. a. How much debt relative to total value of debt and equity combined does XYZ have? b. How much equity relative to total value of debt and equity combined does XYZ have?

8. Determine the weighted average cost of capital.

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