ACC 300 at University of Michigan--Ann Arbor

6. Borrowing Cost

in Topic 11 (Video 6 of 8)
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With bonds selling at discounts and premiums, how do we find out what the real cost to borrow actually is? Well, there are two methods and we'll give both a shot.

This Video Mentioned Some Formulas

Cash Out
– Cash In
Cost of Borrowing (Bonds)
Cash Payments
– Premium
+ Discount
Cost of Borrowing (Bonds)

The Rest Of The Videos

1 Intro to Bonds 10:04
2 Discounts and Premiums 7:34
3 Selling at a Discount 7:15
4 Selling for a Premium 8:11
5 Amortization 21:42
6 Borrowing Cost
You are here. 		6:33
7 Interacting with Market Rates 5:30
8 Retiring Bonds 9:54
Topic 12 →

Topic 11 Practice Problems

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1 Bond Theory Multiple Choice Easy
2 Bond Issue Prices Moderate
3 Coupon and Market Rates Multiple Choice Moderate
4 Bond Amortization Hard
5 Bond Retirement Hard
← Topic 10

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