The following questions pertain solely to “5% senior note due 2022”. You may assume that coupon payments are made annually and there were no new issuances or retirements. (a) Is the amount of cash John Deere got at issuance greater than, less than or equal to the amount that it has to pay the lender at maturity? How do you know? (b) What is the coupon payment for fiscal year 2017? (c) What is the interest expense for fiscal year 2017? (d) Explain why the amounts in (b) and (c) different in terms of John Deere’s economics.
