Problem:
Seether Co. wants to issue new 13-year bonds for some much-needed expansion projects. The company currently has 9.8 percent coupon bonds on the market that sell for $868.69, make semiannual payments, and mature in 13 years.
Required:
Question: What coupon rate should the company set on its new bonds if it wants them to sell at par
- 5.90%
- 11.50%
- 12.10%
- 11.80%
- 11.70%
Note: Be sure to show how you arrived at your answer.