a. The face value is $100,000, the coupon rate is 5.5% APR, interest is paid semiannually, the time to maturity is 6 years, the annualized yield is 6.4%. What is the current bond price?
b. The current share price is $48.00, the upcoming dividend is $3.25 per share, the return on equity is 11%, dividends grow at a constant rate. What is the share price at year 2?
c. The current share price is $5.35, there are 22 million shares outstanding, the value of debt is $34 million, the return on debt is 6.9%, the equity beta is 1.73, the risk-free rate is 2.3%, the market risk premium is 6.1%. What is the CCC?
The solutions are:
a. D0 = 96.0502
b. P2 = 52.1459
c. CCC = 0.1152
What are the steps to getting these answers?