Buchanan corp is refunding 10 million worth of 10 debt the


1. The value of a country's currency may increase by

A. continuous excessive government spending.

B. a stock market rally in that country.

C. an increase in that country's money supply.

D. more than one of the above.

2. Buchanan Corp. is refunding $10 million worth of 10% debt. The new bonds will be issued for 8%. The corporation's tax rate is 35%. The call premium is 9%. What is the net cost of the call premium?

A. $390,000

B. $1,080,000

C. $585,000

D. $702,000

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Financial Management: Buchanan corp is refunding 10 million worth of 10 debt the
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