Answer:
Assuming that the bonds are sold at par (no discount or premium), the annual coupon payments should be:
year 1 = 850,000 rubles, equal to $27,200
year 2 = 850,000 rubles, equal to $28,900
year 3 = 850,000 rubles, equal to $29,750
plus the face value of 5,000,000 rubles equal to $175,000
The company received 5,000,000 rubles today equal to $150,000
using an excel spreadsheet:
-150,000
27,200
28,900
204,750
and the IRR function, the cost of financing is 23.39%
