Calculation of after tax cost (in %) and the market value of the long term debt?Kd (after tax) = Interest ( 1 – tax) + (Par value of debentures – Net Proceeds) / n(Par value of debentures + Net...

Calculation of after tax cost (in %) and the market value of the long term debt?






Kd (after tax) = Interest ( 1 – tax) + (Par value of debentures – Net Proceeds) / n






(Par value of debentures + Net Proceeds) / 2






Interest = $1000 * 8% = $80






Net proceeds = $1000 – Underwriting Expenses






Net proceeds = $1000 – 45 = $955






Kd (after tax) =80 ( 1 – .35) + (1000 – 955) / 15






(1000 + 955) / 2






Kd (after tax) =(52 + 3) / 977.50






Kd (after tax) =(52 + 3) / 977.50 = 5.63%






Calculation of Market Price per Bond:






Yield to maturity on existing debt = 8%






Let the market Price be X






YTM = Coupon rate + (Par value – X )/n * 100






(Par value + X)/ 2






YTM = (9% * 1000) + (1000 – X) /15 * 100






(1000 + X) / 2






8 = 90*15 + (1000 – X) * 2 * 100






(1000 + X) 15






8000 + 8X = (1350 + 1000 – X) * 200






(8000 + 8X)15 = (2350 – X) * 200






120000 + 120X = 470000 – 200X






320 X = 350000






X = 1093.75






Thus the market Price is $ 1093.75






Market Value of Debenture = Book Value / Par value * Market price


Assignment #2: Group Work Due Date:May7, 2023 Length:3000 words Value:30% Group size: 4 students per group Topics:Analysis of Risk and Return of Chinese Stock Market Purpose · have an appreciation of the relationship between measures of risk and return · have enhanced range of generic skills with special emphasis on analytical skills such as the ability to interpret data and reports and appreciative skills such as the ability to receive, evaluate and react to new ideas · To gain experience in formal report writing. · To gain experience in research. Background information A sample should be selected from the Stock Market of China. Your analysis will be based on calculation of the rate of return and risk of the Shanghai or Shenzhen stock market during year 2018-2022.. Your task You are to conduct an analysis of Chinese stock market’s risk and return relationship. You will be required to calculate the rate of returns and risks (beta) of some selected listed companies for the specified periods and use statistical tools (i.e., regression analysis) to make analysis. Then present and interpret the relationship in light with the other empirical findings in the relevant literature. Conclude with your findings of the relationship between risk and return and its implications Data To analyse the situation, you will need to put it in a context. You will be required to do some research to establish that context. Your research related to the stock market will not be limited to the information provided in the public media. In addition, you should review relevant materials from the accounting, finance and economic journals, sources such as newspapers, periodicals and investment resources related to the current economic environment. Referencing: Harvard referencing style Required: (1) The assignment should be structured as follows: Introduction：The overview and development of recent years’ Chinese Stock Market Calculation and analysis: Use different statistical terms and CAPM model and related portfolio theory to analyses the risks and returns of the sampled companies in the stock market. Conclusion: Evaluate the risk and return of Chinese Stock Market and draw a conclusion. References (2) The data collected should be based on the recent 15 years. (3) The assignment should be printed on A4 size sheets on one side only and student ID must be printed on all pages of assignment. (4) Every student should declare in writing that you have participated in the work. The statement should be handed with the group assignment.