Carrefour

Calculate the price of this bond if the YTM is (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.):

The first Loblaw grocery store opened in 1919 in Toronto and then chain expands to more than 70 stores in Ontario and to New York the new self-serve, cash and carry concept of grocery retailing is a big hit with customers and new Loblaw’s is a supermarket chain with over 2000 stores in Canada, headquartered in Brampton, with stores in British Columbia, Alberta, Ontario and Quebec. Loblaw’s is a division of Loblaw Companies Limited, Canada's largest food distributor. long-term growth. Loblaw is grocery store of the future needs to offer a better life, not just better food. So Loblaw has managed to be consistent in its mission and agile in its methods at the same time.

The value of a bond is found as the present value of interest payments plus

nominal 6% bond specified in the contract. The formula to find conversion factor is as follows:

4. Total conversion cost = $128,000 + $16,000 + $9,000 + $64,000 + $41,000 + $35,000 + $46,000 = $339,000

At what price will the bonds issue? (Do not round PV factors. Round your answer to the nearest dollar amount. Omit the "$" sign in your

For investors who own the 8.25 May ’00-’05 bond, the current bid price for 8.25 May ‘00-’05 bond is 101.25. To compute the theoretical price we have to use bid prices: (129.71875*0.6875) + (29.90625*0.3125) = $98.5273438. This shows that 8.25 May 00-05 bond is overpriced. The profit earned is 101.123-98.5273 = $2.5977. The investors should sell this bond and replace it with any of the undervalued synthetic bonds preferably the first synthetic bond

From the point of view of the income statement, the current year earnings would decrease by $2.24 million ($11.54million - $9.3 million).

What impact would this preference have on the prices, hence YTM, of the tow bonds?

c. Should the nominal cost of Debt or the effective annual rate be used? Since the bond pays a coupon semi-annually, and earns 4.75% in six months, it is possible to determine the effective annual rate (EAR), which we have successfully calculated above. EAR = 6.6% Nevertheless, nominal rates are typically used for the cost of debt, because total costs of issuance and sale of securities decrease the net proceeds from the sale. These costs are naturally small on public debt issues.

B. Suppose an American exporter has just received a payment of € 100,000, how many dollars will result upon conversion?

2. The discount rate for this bond would be 0.70%. I started with an appropriate discount rate to derive my bond purchase price, since I would not purchase a bond without finding out ahead of time what a good price should be.

Besides the lowest coupon rate in Switzerland, we further calculate the bond repayment in determining which currency Carrefour better choose to issue its 10-year bond. Given all the data in which we will use it as out inputs in this case, using Excel to calculate the bond repayment and total interest rate over 10 years period.

TABLE OF CONTENTSQuestion 1a ……………………………………………………………………………………………………………………….3b ……………………………………………………………………………………………………………………….3c ……………………………………………………………………………………………………………………....4Question 2 …………………………………………………………………………………………………………………………………5Question 3 …………………………………………………………………………………………………………………………………6Question 4 …………………………………………………………………………………………………………………………………6References …………………………………………………………………………………………………………………………………7QUESTION 1a.Calculate the cost of the activities for France.

Carrefour is a French based retail store whose ranking in 2008 was number two behind that of Walmart. It had a very strong European market with strong global recognition and impact and had strong profitable growth. In its acquisition in the global market it decided to expand its retail market in Russia. Carrefour was considered a hypermarket because of its offer of 80,000 products and its occupying anywhere from 5,000 to 20,000 square foot. Carrefour was founded in 1960 and was a store the provided a variety of goods and services. It provided self-service grocery stores, clothing, sporting goods, electronic goods and auto accessories. In 1963 Carrefour was branded as a Hypermarket due to its huge size and by 1966 Carrefour opens a10,000 square feet store in Lyons France and a 20,000 square foot in Vitrolles. Soon after, the company began to expand into the global market with its first store in Belgium and by 1970 Carrefour stock was listed on the Paris stock exchange. In 1975 Carrefour open its first store outside of Europe in Brazil and within 10 years they were now operating in 10 countries. In 1988 Carrefour entered the US market opening a store in Philadelphia and by 1992 Carrefour reported worldwide sales of €17.86 billion and a net income of €271 million. In 1996 Carrefour open 30 more stores across the world and by 1997 they also expanded their store to 15 stores in south America. Carrefour would become the second largest retailer in 2008 operating 15, 430