Curry Corporation is setting the terms on a new issue of bonds with warrants.The bonds will have a 30-year maturity and annual interest payments.Each bond will come with 18 warrants that give the holder the right to purchase one share of stock per warrant.The investment bankers estimate that each warrant will have a value of $13.90.A similar straight-debt issue would require a 12.0% coupon.What coupon rate should be set on the bonds-with-warrants so that the package would sell for $1,000? Do not round your intermediate calculations.

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? 11ea856c_8aef_92c0_9aec_6373f4af4265_TB1222_00 11ea856c_8aef_b9d1_9aec_777e197f50fd_TB1222_00 Set N = 30,I/YR = 12.0%,PV = ?749.80,and FV = 1,000.Then solve for PMT: $88.94
To get this payment on a $1,000 bond,the coupon rate = PMT/$1,000 = 8.89%

Curry Corporation Is Setting the Terms on a New Issue