Problem 7.28 – Zero-Coupon Bond Issuance and Interest Deductions

Fundamentals of Corporate Finance

Ross, Westerfield, and Jordan

13th Edition

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Determine the issuance price, interest deductions using the IRS amortization rule and straight-line method for a zero-coupon bond issued by a corporation to finance its plant expansion, given the par value, required return, and compounding periods.

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