calculate cost of debt using LIBOR and spread

hello ladies and gentlemen

Example 13 book of corporate finance page 62

the example ask for calculate the weighted cost of debt by the LIBOR + premium of debt to capital ratio (spreads)

can someone show me how we can summing the points of 200 with LIBOR rate of 4.5% please.

Assuming I’m understanding what you’re asking,

200 basis points (bps) = 2% + 4.5% = 6.5%

1 bps = .0001

10 bps = .001

100 bps = .01

Use bankers interest rate for the montly or 3 month or full term payment of interest. Your rate is the LIBOR rate plus points. Interest will be ((1 + (rate/360))^days - 1)* loan amount, paid at the end of each days of the period.Custom essay writing service is giving the dissertation draft writing guidelines for the students.