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Thank you very much for all your help and support. Please could you look into and advice if thats the correct way to get MV when company itself want to find of MV instead of investors.
I am very confused at what discount rate to use to discount annual interest receipts as Directors of the company want to know the MV of per 8% loan note redeem at par in 5 years time.
cost of debt given before tax 4%, tax 25%What is the market value of per loan note?
discount rate 4%X.75= 3%
1-5- 8x.75X (5 years annuity rate at 3%)
5 100X (Present value in 5 years time)Also, cant get my head around with tiny efficient market hypothesis scenarios like “company’s share price reacted from the information released yesterday”.
will that be weak or semi efficient market?Thanks a lot John, God bless you!
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