Delta Bank plans to issue 10 000, 10-year, 15% coupon bonds. Each bond will be issued at a par value of R1 000. To make the bonds attractive to investors, the bank plans to issue them at a discount of 2.5%.
1. If the issue will result in flotation costs of 3% being incurred, what is the YTM?
2. Assuming that Delta Bank is taxed at 25%, what is the after-tax cost of the bond?

Answers

Answer 1

The after-tax cost of the bond is 12.14%.

To calculate the yield to maturity (YTM), we need to find the present value of all future cash flows.

First, let's calculate the annual interest payment on each bond:

Annual coupon payment = Par value x Coupon rate = R1 000 x 15% = R150

Next, let's calculate the price of each bond after the discount:

Price of bond = Par value x (1 - Discount rate) = R1 000 x (1 - 0.025) = R975

Using this information, we can set up an equation to solve for YTM:

R975 = R150 / (1 + YTM)^1 + R150 / (1 + YTM)^2 + ... + R150 / (1 + YTM)^10 + R1 000 / (1 + YTM)^10

Using a financial calculator or spreadsheet, we can solve for YTM, which is approximately 16.19%.

Next, let's calculate the after-tax cost of the bond. The before-tax cost of debt is equal to the YTM, which we just calculated as 16.19%. Since Delta Bank is taxed at a rate of 25%, the after-tax cost of debt is:

After-tax cost of debt = Before-tax cost of debt x (1 - Tax rate) = 16.19% x (1 - 0.25) = 12.14%

Therefore, the after-tax cost of the bond is 12.14%.

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Related Questions

The pre-approved amount of money that a bank is willing to lend a credit card holder is the credit __________. A. Balance B. Rating C. History D. Limit

Answers

Answer:

Limit

Explanation:

Answer:

D. Limit

Explanation:

FILL THE BLANK. "Which of the following accounts is closed as part of the
financial reporting cycle?
I. Unearned Service Revenue
II. Retained Earnings
III. Dividends
--------------------------------------------
II onl"

Answers

Retained earnings are undistributed profits kept as part of a company's capital. The financial reporting cycle is the process of recording, analyzing, and summarizing financial information to prepare financial statements.

Retained Earnings is the account that is closed as part of the financial reporting cycle.What is retained earnings?Retained earnings are a company's net income that is not distributed to shareholders as dividends but is kept as part of the company's capital base. Retained earnings are often reinvested in the business's operations to expand its operations or to pay off debts.What is the financial reporting cycle?The financial reporting cycle is the method used to record, analyze, and summarize accounting information. A business's accounting cycle begins with the recording of daily financial transactions and concludes with the preparation of financial statements. Financial statements are prepared at the end of the accounting period, which can be monthly, quarterly, or annually to determine the company's financial performance.

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two important features that managers can adjust in an effort to improve the firm's strategic position are

Answers

Two important features that managers can adjust in an effort to improve the firm's strategic position are product features, customer service .

What is Strategic positioning  ?

Strategic positioning refers to a company's choices regarding how to satisfy customers and outperform competitors. The competitive environment, the firm's internal resources and capabilities, the state of the industry, and information about the macroenvironment are all factors that a firm must consider in order to develop its position.

What is an example of a strategic position?

A computer corporation that concentrates on offering cutting edge technology at premium prices before its competitors would provide an excellent example of a positioning strategy.

                   A huge chain store that prioritizes offering well-liked products to many people at affordable prices is another example of a positioning strategy in action.

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A cover letter accompanies_____?

A. a college application

B. the FAFSA

C. a letter of recommendation

D. a résumé

Answers

I think it’s D because... well because it makes the most sense

Answer:

B brainliest?

Explanation:

What are the objectives of businesses issuing securities to the public?
1) To get the best possible price for their securities.
2) To market the issues to the public at the lowest cost.
3) To issue fairly simple securities requiring little incremental analysis.
4) All of the above are true.
5) None of the above is true.

Answers

Given these objectives, the correct option is 4) All of the above are true, as each statement aligns with a different objective commonly pursued by businesses when issuing securities to the public.

The objectives of businesses issuing securities to the public can vary depending on their specific circumstances and goals. However, a common set of objectives can include:

1) To get the best possible price for their securities: When businesses issue securities to the public, they aim to maximize the proceeds they receive from the sale. This involves attracting investors and generating demand, which can lead to a higher price for the securities.

2) To market the issues to the public at the lowest cost: Issuing securities can involve various costs, such as underwriting fees, legal expenses, and marketing costs. Businesses seek to minimize these costs while effectively promoting and distributing the securities to potential investors.

3) To issue fairly simple securities requiring little incremental analysis: Simplifying the structure and terms of the securities can make them more attractive to investors and facilitate the evaluation process. This objective aims to make the securities easier to understand, analyze, and compare with other investment options.

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what does a high employment rate include?

Answers

A high employment rate is a good thing, high employment is when all of our available labor resources are being used in the most efficient way possible
A high employment rate increases the stock market. Additionally, if an employment rate is low then less people will have money to spend therefore decreasing the profits that a specific country will gain.

A ceiling design that has a rectangular center that is either popped out or inverted to add an effect.​

Answers

Answer:

tray ceilings

Tray Ceiling - Usually seen in dining rooms and kitchens, tray ceilings are built upwards in a cut out resembling a tray. It has a rectangular center that is either popped out or inverted to add an effect

Explanation:

Hope it helps

4. Many jurisdictions/organizations configure their EOCs using the standard _______ organizational structure

Answers

According to the research studies, many jurisdictions/organizations configure their EOCs using the standard Incident Command System (ICS) organizational structure.

The Incident Command System (ICS) is the process or the system which the firms employ to ensure that their Emergency Operations Centers function well and effectively.

The Incident Command System (ICS) is categorized into five major components, which include the following:

Command, Operations, Planning, Logistics, Finance/Administration.

Hence, in this case, it is concluded that the correct answer is "Incident Command System (ICS)."

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deals with the challenges that a company
faces in the ever-changing business
environment

Answers

Answer:

Strategy.

Explanation:

Strategy can be defined as a coordinated deployment of a firm’s resources to achieve competitive advantage in the industry where it operates. Basically, it is a long-term plan of action that is focused on using a firm's available resources to achieve set objectives and goals such as includes dominating the market, expanding the business, meeting customer's demands etc.

Generally, the top executive management is saddled with the responsibility of ensuring that their business strategy is in tandem with the aim, objectives, vision and mission statement. A good business strategy is a continuous process that should function as a roadmap or guide to achieve competitive advantage, sustained profitability, growth and development of an organization.

Hence, strategy deals with the challenges that a company faces in the ever-changing business environment.

Additionally, the strategy formulated by an organization can be classified into the following categories; growth strategy, marketing strategy, product strategy etc.

The materials price variance is calculated using the ______ quantity of the input purchased.

Answers

Answer:

the answer is: calculator

All of the following are examples of the food and beverage industry
except
-school cafeteria
-McDonald's inside a Walmart
-restaurant inside a shopping mall
-travel agency

Answers

Answer:

-travel agency

Explanation:

The food and beverage industry is made up of establishments whose core business is preparing meals, snacks, and beverages as per customers' orders for immediate consumption in or off the premises. A school cafeteria, McDonald's inside a Walmart, and restaurant inside a shopping mall will fit into the food and beverage industry's definition.

A travel agency is best placed in the tours and travels industry.

The expected return on the market will increase if the risk-free rate _________ or if the market risk premium _____.

Answers

Answer:

The expected return on the market will increase if the risk-free rate increases or if the market risk premium increases, because RMRM=RF- risk premium.

Explanation:

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If the price of a pencil is $1.00 and the price of a pen is $2.00, what is the relative price? If the pencil
is $1.50 and the pen is $3.002 If the pencil is $2.00 and the pen is $3.00?

Answers

If the price of a pencil is $1.00 and the price of a pen is $2.00. 3 dollars will be the relative price.

$1 + $2 = $3

A price relative is the ratio of the charge of a selected product in a single period to the rate of the identical product in a few different period. In buying power parity (PPP) comparisons a rate relative refers to the ratios of the equal product in two international locations.

The nominal price of a great is its value in phrases of cash, including bucks, French francs, or yen. The relative or actual rate is its fee in terms of some other suitable, carrier, or package of goods.

Relative-price movements convey critical facts approximately the scarcity of specific items and offerings. A growing relative charge suggests that call for is outstripping deliver (or that supply is falling at the back of call for), while a falling relative price denotes just the other.

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Lamonte needed to get his computer fixed. he took it to the repair store. the technician at the store worked on the computer for 4.25 hours and charged him $141 for parts. the total was $544.75. what was the cost of labor, per hour?

Answers

Answer:

Explanation:

$544.75- $141= $403.75

$403.75 divided by 4.25= 95

A corporation distributes a 10 percent common stock dividend on 30,000 shares issued when the market value of it's common stock is $24 per share and its par value is $2 per share. On the distribution date, a credit _ would be journalized​

Answers

Answer:6,000

Explanation:

I just took the test

Pablo runs a small car washing business in his neighborhood on the weekends. This
past weekend, Pablo earned $284. Prior to opening his car wash, he needed to stock
up on soap, sponges, and towels which cost him $46. He also had his son help him
with the car washing and paid him $25 for his help. What was Pablo's net income for
this past weekend?

Answers

Answer:
$213

Gross is the total amount earned before expenses, net is the amount earned after expenses.

We must subtract the amount of money earned by the amount of money spent. 71-284=213

write a short note on meditation​

Answers

Answer:

Explanation:Meditation is a practice where an individual uses a technique – such as mindfulness, or focusing the mind on a particular object, thought, or activity – to train attention and awareness, and achieve a mentally clear and emotionally calm and stable state.

Meditation meditation meditation meditation meditation meditation meditation session meditation meditation meditation meditation made a To integers between eight is six and seven

To integers between eight is six and seven

which of the following is an example of passive income? dividends from accumulated earnings and profits of an s corporation. income from rental real estate activities. winnings from gambling activities. interest and dividend income.

Answers

interest and dividend income is the perfect example of passive income. Earnings from the portfolio, which might be derived from a number of sources such interest, dividends, and annuities.

In general, income is stated in monetary terms and refers to an entity's ability to save and consume within a given time frame. Conceptually, it is challenging to define income, and various disciplines may have distinct definitions. One's income may differ from their income as defined by legislation, for instance, depending on how they define it economically. Haig-Simons income, which defines income as Consumption + Change in Net Worth and is commonly applied in economics, provides an incredibly significant definition of income. Income is defined by tax law as a figure that includes all wages, salaries, profits, interest payments, rent, and other forms of earnings earned throughout a calendar year for families and individuals in the United States.

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Please help now its culinary

In general, what are the two main parts of a recipe?

equipment required and ways to duplicate recipe

the ingredients list and directions for what to do with them

the cooking temperatures and alternate ingredients

suggested timing and range of temperatures

Answers

The two main parts of a recipe include the ingredients list and directions for what to do with them (Option 3).

What is a culinary recipe?

A culinary recipe can be defined as a sharply controlled mix of food ingredients in a sequentially ordered way in order to develop a unique food that may stimulate the taste of such ingredient combination.

The development of recipes represents one of the most important hallmarks of a given society living in a region and or country because food ingredient changes regarding the region and also taste preferences are distinct and shape a given society.

Therefore, with this data, we can see that a culinary recipe is based on the list of food ingredients that are mixed in an ordered and sequential manner in order to stimulate the taste, which is a culinary issue that characterizes a society.

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Using the text boxes below,draw the business .Then decide each stage of the business cycle

Answers

The question isn't full and there aren't any boxes provided, so I'll explain the stage of the business cycle instead.

There are four stages to the business cycle: expansion, peak, contraction, and trough.

What are the stages of the business cycle?

The repeated economic shifts that occur in a nation over time are referred to as business cycles. It can be recognized by changes in the GDP and other macroeconomic indicators. The expansion, peak, contraction, and trough phases of the business cycle are all separate from one another.

Which four phases make up the business cycle?

There are four stages that make up the economic cycle, often known as the business cycle. They are as follows:

Expansion: The economy grows relatively quickly during an expansion, interest rates are often low, production rises, and inflationary pressures increase.Peak: A cycle peaks when growth accelerates to its fastest rate. Economic imbalances caused by peak growth often need to be addressed.Contraction: During a contraction, when growth slows, employment declines, and prices remain unchanged, a correction takes place.Trough: When the economy reaches a low point and growth starts to recover, the cycle trough is achieved.

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_____ list the knowledge, skills, and abilities (ksas) an individual needs to perform a job satisfactorily.

Answers

Job specifications list the knowledge, skills, and abilities (KSAs) an individual needs to perform a job satisfactorily.

Knowledge is defined as something learned, understood, or conscious. One example of knowledge is learning the alphabet. One example of knowledge is the ability to find places. One example of knowledge is remembering details about an event.

Knowledge refers to information or knowledge gained through experience or education, understanding refers to knowing or realizing the intended meaning or cause of something. Knowledge is better than understanding. Knowledge and understanding go hand in hand.

Knowledge is the understanding and perception of something. It refers to information, facts, skills and wisdom acquired through learning and experience in life.

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Why does the united states have limited to no trade with countries like cuba and venezuela?.

Answers

On September 4, 1961, partly in response, Congress handed the Foreign Assistance Act, a Cold War Act (among many different measures) that prohibited useful resource to Cuba and approved the President to impose a whole trade embargo towards Cuba.

What is the alternate relationship between the US and Cuba?

U.S. diplomatic illustration in Cuba is handled with the aid of the United States Embassy in Havana, and there is a comparable Cuban Embassy in Washington, D.C. The United States, however, continues to preserve its commercial, economic, and economic embargo, making it unlawful for U.S. corporations to do enterprise with Cuba.

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Police are investigating the site of a convenience store robbery. The glass door was
broken, and it looks as if several packages of cigarettes are missing from behind the
counter. One police officer notices a man walking past the store and gets an odd
feeling about him. He stops the man and insists on searching his pockets. Inside the
man's pockets, police find several packs of cigarettes. They arrest the man and
charge him with the crime. Unfortunately, the judge throws out the charges. What is
MOST likely the judge's reason for dismissal?
A-The man is under 18 years old.
B-The man did not have money to post bail.
C-The policeman did not have probable cause to search the man.
D-The policeman did not have enough evidence that the man was the robber.

Answers

I would say the answer is D because he assumes the man stole them, didnt even ask for a receipt or confirm with the store clerk if he did buy them.

The MOST likely judge's reason for dismissal is the policeman did not have enough evidence that the man was the robber. Thus the correct option is D.

What is Robbery?

Theft or robbery is defined as the stealing of someone else's property without their permission and using force or a threat of force that exhibits fear in them to perform any action against them.

To prove a crime against someone requires one to submit enough evidence which helps to establish the claim as the justice system is based on evidence not on arguments.

In the given case, police found the activity of the men suspicious as they found cigarette packets from him. There is no evidence that he has stolen the cigarette packets might be possible he has purchased them.

So due to a lack of evidence against the person the Judge dismissal the case. Therefore, option D is appropriate.

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What is moral myopia? Why do you think an advertising professional might experience this phenomenon?

Answers

Answer: See Explanation

Explanation:

Moral myopia occurs when someone is unable to clearly see ethical issues. In this case, people decide not to say anything even though they see the unethical behavior of others.

An advertising professional might experience moral myopia in the sense that such person looks away when he or she sees an unethical act because of fear of losing his or her job and also because of fear of losing a customer.

PLEASE HELPPPPP due by tomorrow pleaseeee
write a one-page report that details the individual’s job position, education, and career training, current job responsibilities, and what the person enjoys the most about the job position.

Answers

The job description contains sufficient information to describe major responsibilities and essential functions as they exist today. They provide the information necessary to classify the position, not the person; thus they are “incumbent neutral” and not based on any specific quality of an incumbent (such as knowledge, skills, abilities, performance, dedication, loyalty, years of service, or degree). The document should not include every detail of how and what work is performed so that it remains useful even when minor changes occur. Job descriptions can be written as a joint effort between supervisor and employee, but the supervisor must approve.

when reading walmart's income statement, which item contains the money walmart paid to buy the inventory that is sold in its stores?

Answers

The item that contains the money that Walmart spent to pay for inventory, on its Income Statement is Cost of Sales.

What are cost of sales?

Cost of sales, which are also called cost of goods sold, are the item in the income statement that will show the amount that the company in question, which is Walmart, spent on the goods that they sold.

To find the cost of sales, the following formula is used:

= Opening inventory for the period + Purchases in the period - Ending inventory for the period

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You decide to purchase real property, what type of property (condo, single family home, apartment building, commercial property, parking lot, etc.) would you buy? why?

Answers

I would purchase Single-family home because it gives more privacy and can be used as real estate investing.

What is a single-family home?

A freestanding home set alone on its own piece of property.A single-family home is an independent residential structure that sits on its own land and is designed to be used as a single dwelling unit, having just one kitchen, unshared walls and unshared utilities.It gives you more privacy as it is built on a piece of private property and doesn't share walls. There is always more storage space compared to any other type of property with shared walls, you have scope for shed or garage.It has low cost entry, Reduced Tenant Turnover.

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Why are short term and long term goals important when it comes to money? Give an example of each

Answers

Answer:

bc will need for emergency in short time and long time for collage

Explanation:

Answer:

The precision of planned statistics that relate to future activities is a benefit of short-term planning. Long-term planning may be less trustworthy due to the inaccuracy of longer-term projections.

Long-Term Financial Objectives For most people, the most important long-term financial objective is to save enough money to live comfortably.

Virtually all organizations, from small startups to huge established firms, require short-term money management. Even huge corporations with seemingly strong financial accounts have declared bankruptcy because they were unable to pay their existing obligations.

Explanation:

One way that nations can control the value of their currency is by establishing a ____________, in which the value of a currency is set at a specific value relative to another currency or some other measure of value.

Answers

One way that nations can control the value of their currency is by establishing a fixed exchange rate, in which the value of a currency is set at a specific value relative to another currency or some other measure of value.
One way that nations can control the value of their currency is by establishing a "fixed exchange rate system", in which the value of a currency is set at a specific value relative to another currency or some other measure of value. This system helps stabilize the currency's value and maintain a predictable exchange rate for international trade and investment.

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FILL IN THE BLANK. A way to send transactions directly from one computer to another instead of using a paper check is through the use of ______. (Select all that apply)
Multiple select questions.
(A) Federal Reserve transfers
(B) debit cards
(C) electronic funds transfer (EFT)
(D) money orders

Answers

A way to send transactions directly from one computer to another instead of using a paper check is through the use of debit cards and electronic funds transfer (EFT).

How do EFT transfers work?

EFT stands for electronic funds transfer, which is the electronic movement of monies from one bank account to another, either inside a single financial institution or across numerous institutions, using computer-based systems and without the direct involvement of bank staff. It is described as "a funds transfer initiated through an electronic terminal, telephone, computer (including online banking), or magnetic tape for the purpose of ordering, instructing, or authorizing a financial institution to debit or credit a consumer's account" by the Electronic Fund Transfer Act of 1978 in the United States.

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Question 1: Explaining the concept of depreciation GraysonSander has just slept through the class in which Professor Bestexplained the concept of depreciation. Because the next test isscheduled for Which is the property of matter in which a substance can transfer heat or electricity? Complete the following table of Trial I (See Report Sheet) for determining the molar concentration of a standard NaOH solution, followed by the determination of the molar concentration of a monoprotic acid solution according to the exper- imental procedure. Record calculated values with the correct number of significant figures A. Standardization of a Sodium Hydroxide Solution 1. Tared mass of KHC,H,0, (8) 2. Molar mass of KHC,H404 (g/mol) 3. Moles of KHC,H,O, (mol) 0444 Show calculation. 4. Buret reading, initial (mL) 5. Buret reading. final (mL) 6. Volume of NaOH dispensed (ml.) 7. Molar concentration of NaOH solution (molVL) B. Molar Concentration of an Acid Solution 1. Volume of acid solution (mL.) 2. Buret reading, initial (mL) 3. Buret reading, final (mL) 4. Volume of NaOH dispensed (mL) 5. Molar concentration of NaOH solution (moUL) 6. Moles of NaOH dispensed (mol) Show calculation. 7. Molar concentration of acid solution (moV/L) Show calculation. Identify the distance between points (- 3, 0, - 7) and (- 8, - 9, - 11) , and identify the midpoint of the segmen for which these are the endpoints . Round to the nearest tenth, if necessary I need help. This is due in the next hour. () Which of the following best describes the role of women during the period 1450 to 1750?Although there were many powerful female rulers like Elizabeth I and Nur Jahan, the status of women remained mostly unchangedMany societies became matrilineal and were run by older women in the community due to mass migration of menMixed offspring as a result of global exploration and colonization led to a decrease in marriage restrictions based on race and classInnovations in production turned over traditionally male jobs to women as mass migrations led to uneven populations How is a chemical equation different from a chemical formula? Are the figures below similar?NO LINKS!! NEED ANSWER ASAP a client receiving total parenteral nutrition (tpn) asks the nurse if he has developed diabetes when the capillary blood glucose level is monitored and he is given insulin. the nurse explains that which is the reason for monitoring glucose levels and administering insulin? Which of the following organs is NOT part of the cardiovascular system?a. Capillaryvuestionb. SpleenC. Arteryd. Vein TODAY, Kyle has 11 pounds to lose to get to his goal weight. Tuesday he was 196 lbs. TODAY, he is down 3 lbs. What is Kyles weight today?What is Kyles goal weight? please help me on this geometry!!! give the equation of the line in slope intercept form that is perpendicular to y=-5x+3 and passes through (2-0) 1. What is the value of x?A. 21B. 41C. 22D. 20 Explain three specific abilities Adlle penguins would need in order to thrive in the Antarctic in the next 50 years A recipe for 2 dozen whole-wheat muffins requires 600 g of flour. How may muffins can be made with 900g of flour liza minnelli married the son of the actor who played which character in the ""wizard of oz""? The ___________ is different from other layers of the atmosphere because it doesn't have a mixture of gases; it has layers of single gases. A. Thermosphere B. Stratosphere C. Troposphere D. Mesosphere When a company does not have enough capacity to produce all of the products and sales volume demanded by their customers, this leads to keep or drop decisions volume trade-off decisions sell or process further decisions make or buy decisions James runs 400 metres a day. He runs for five days. What is the total distance run in kilometres