1. You have decided to advance refund $10,000,000 of outstanding debt that is callable in five years. The interest rate on these bonds is 8%. You can issue new bonds at 6%. For every dollar of new debt issued, you will incur a 5% issuance cost. Interest payments on the present issue are $800,000 per year with no scheduled principal payments. How much new debt needs to be issued to realize defeasance of the present issue?
https://homeofessays.com/wp-content/uploads/2020/06/logoHOE-1-300x60.png 0 0 admin https://homeofessays.com/wp-content/uploads/2020/06/logoHOE-1-300x60.png admin2018-03-28 10:41:592019-05-30 10:22:40You have decided to advance refund $10,000,000 of outstanding debt that is callable in five years.
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