FM11 Ch 17 P08 Build a Model

5 to 8 million cost of debt face value of debt hint

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Unformatted text preview: 8 million. Cost of Debt Face Value of Debt hint: use a data table 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5 5.5 6 6.5 7 7.5 8 b. Graph the values of debt and equity for volatilities from 0.10 to 0.90 when the face value of the debt is $2 million. Value of Debt Value of Equity Volatility Face Value of Debt Volatility Face Value of Debt 2 2 0.1 0.1 Note: Use a 2-dimensional data table here and in part c. That way, you 0.2 0.2 can change the face value of debt for the table, without having to 0.3 0.3 change the base 'face value of debt for all the rest of the problems. A 0.4 0.4 formula that gives the value of equity or debt goes in the shaded cell 0.5 0.5 under "Volatility" and the column input 'cell is C21, while the row...
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This document was uploaded on 01/19/2014.

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