REINA_CP_TaskI.xlsx

REINA_CP_TaskI.xlsx - Amanda Reina 7/24/2011 Finance Course...

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Amanda Reina 7/24/2011 Finance Course Project Part I Task I: (1) For National Bank: Prime bank loan rate=3.25% So National first Interest rate=3.25%+6.75%=10% paid semiannually Hence, = + % - = . % Effective Annual rate for National Bank 1 10 22 1 10 25 For Regions Best: Interest rate=13.17% paid monthly Hence, = + . % - = . % Effective Annual Rate for Regions Best 1 13 17 1212 1 13 99 (2) Based on the above information it can be said that National First bank is the best choice because it has the lowest interest rate and choosing this would reduce the cost of debt for the company. (3) Given that, Loan amount=$6,950,000 APR=8.6% So monthly rate of interest=8.6%/12=0.72% Times to maturity=5 years So, number of monthly payment required=60 So the monthly payment = , , * = + . % = , . amount $6 950 000 t 16011 0 72 t $142 925 09 Task II: (1) For Raytheon Co. (RTN): Stock Price=$46.27 Dividend paid=$0.31 Quarterly So, Annual Dividend payment=4*$0.31=$1.24 /
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Amanda Reina 7/24/2011 Finance
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This note was uploaded on 07/31/2011 for the course ECON 101 taught by Professor Thielman during the Spring '11 term at DeVry Arlington.

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REINA_CP_TaskI.xlsx - Amanda Reina 7/24/2011 Finance Course...

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