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1. When Super Corp filed for bankruptcy, its balance sheet capital structure (in millions) was: $70 Senior Secured, $120 Senior Unsecured, $50 Subordinated, $30 Junior Subordinated, $40 Preferred Stock, and Common Equity of $150. If the actual total market value of its assets was $230 million, how much would be paid to each level of the capital structure?

2. Netflix has an outstanding zero-coupon bond with 7 years to maturity that has a market rate of 3.2%/year. What is its market price now?

3. Uber's zero-coupon bond is trading at 64 and has exactly 8 years to maturity. What is its current yield to maturity? (Your answer should be a % carried to 2 places.)

4. P&G's outstanding bullet bond will mature in 2035 and carries a coupon rate of 2.8%/year payable semi-annually.

a. How much is each coupon payment?

b. Given a current market price of 101.3, is the market rate > or < 2.8%?

5. You bought a bullet bond issued by Easy-Tech Corp that has a coupon rate of 4%/year paid semi-annually and has exactly 3 years to maturity.

a. Draw a timeline.

b. If the current market rate is 3%/year what is the bond's current market price?

Answer rating: 100% (QA)

1 The total market value of the assets is 230 million This is less than the total capital structure of 460 million which means not all debt obligation... View the full answer