Riggs corp is planning to spend 650000 on a new marketing


  1. Anders corporation issues 1,000 par bonds with 5% coupon rate. Similar bonds have a yield of 8%. At what rate should the bonds sell if they will mature in 10 years? (Please show calculator input)
  2. A company has preferred stock that pays an annual dividend of $2. If similar stocks require a 6% return, what is the price of the stock?
  3. Riggs Corp. is planning to spend $650,000 on a new marketing campaign.They believe that this will result in additional cash flows of $225,000 over the next three years. Should the company accept this project? Their cost of capital is 20%. Use NPV to make a decision.

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Finance Basics: Riggs corp is planning to spend 650000 on a new marketing
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