October 7, 2015

Homework Help: Finance

Posted by Ms. Douglas on Wednesday, October 14, 2009 at 11:25am.

Rollincoast Incorporated issued BBB bonds two years ago that provided a yield to maturity of 11.5%. Long-term risk-free government bonds were yielding 8.7% at that time. The current risk premium on BBB bonds versus government bonds is half of what it was two years ago. If the risk-free long-term government bonds are currently yielding 7.8%, then at what rate should Rollincoast expect to issue new bonds?

Answer this Question

First Name:
School Subject:

Related Questions

More Related Questions