Chapter 24
Question 12
Input Area:
Output Area:
Chapter 24
Question 13
Input Area:
Output Area:
Purchase in year: Initial cost NPV
Chapter 24
Question 14
Input Area:
Output Area:
Chapter 24
Question 15
Input Area:
Output Area:
a. Success:
Failure: (Calculation assumes that if the
project is unsuccessful it will be abandoned.)
Chapter 24
Question 17
Input Area:
Output Area:
Chapter 24
Question 18
Input Area:
Output Area:
Chapter 24
Question 19
Input Area:
Output Area:
Conversion value 105.00$
Speculative option value 85.02$
Face value 1,000$
Current price 960$
Conversion ratio 19
Coupon rate 6.5%
Nonconvertible yield 9.0%
Settlement date 01/01/00
Maturity date 01/01/20
Stock price 45$
Chapter 24
Question 20
Input area:
Output area:
Chapter 24
Question 21
Input Area:
Output Area:
Straight bond value 658.41$
Conversion value 356.67$
# of years 12.39
Face value 1,000$
Settlement date 01/01/00
Maturity date 01/01/25
Coupon 4.8%
Conversion price 90$
Current price 32.10$
Growth rate 11%
Callable value 1,200$
Price when called 1,300$
Required return 8%
Chapter 24
Question 22
Input Area:
Output Area:
Assuming the project lasts four years, the NPV is calculated as follows:
Abandoned after one year:
Abandoned after two years:
Salvage value 9,050,000$