Hamilton pawn shop has two bond issues outstanding compute


Hamilton Pawn Shop has two bond issues outstanding. Compute the weighted average cost of debt for HPS using the following data:

Bond Issue A                  Bond Issue B

Face Value                                                    1000                           1000

Current Price                                                97                                104

Coupon rate                                                  5%                              7%

Payable                                                          Annually                     Semiannually           

Years to maturity                                          14                                6

Number of bonds outstanding                    4000                           2500

What is the YTM on bond A? _________________

What is the YTM on bond B? _________________

What is the market value weight (percentage) for bond A? ____________

What is the market value weight (percentage) for bond B? ____________

What is the weighted average cost of debt? ________________

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Financial Management: Hamilton pawn shop has two bond issues outstanding compute
Reference No:- TGS02160953

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