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Aneli [31]
2 years ago
11

Calculate the price of a two-year bond with a face value of $100, a coupon rate of 5%, and a yield-to-maturity of 5%.

Business
1 answer:
aalyn [17]2 years ago
6 0

The price of the bond is $100.

The bond's price is the present value of the face value plus the present value of the interest accrued throughout the bond's term.

The coupon interest rate is 5% of 100, that is $5 per year. The yield to maturity is also 5%. Because the coupon rate is equal to the yield, the bond's present value will only be its face value.

Present value = 5(P/A, 5%, 2) + 100(P/F, 5%, 2)

                      = 5×1.85941+ 100×0.90703

                       = 100

Therefore, the price of the bond is $100.

To know more about price of the bond click here:

brainly.com/question/15567868

#SPJ4

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Answer:

social environment

Explanation:

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7 0
3 years ago
E20.5 (LO 3) (Application of Years-of-Service Method) Andrews Company has five employees participating in its defined benefit pe
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<u>Solution and Explanation:</u>

<u>Computation of service years </u>

Year  Jim  Paul  Nancy  Dave  Kathy  Total  *  Cost  Amortization

2014  1  1  1  1  1  5            *  3000     15000

2015  1  1  1  1  1  5             *  3000  15000

2016  1  1  1  1  1  5            *  3000  15000

2017   1  1  1  1  4            *  3000  12000

2018    1  1  1  3             *  3000  9000

2019     1  1  2              *  3000  6000

                               72000

<u>Future years of service </u>        

Jim         3          

Paul  4          

Nancy  5          

Dave  6          

Kathy  6          

       24          

cost per service year $=\$ 72000 / 24=\$ 3000$

8 0
3 years ago
According to anthony downs model, a rational party will adopt the policy position that is
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Closest to the view of the majority of voters.

The Anthony Downs model attempts to apply economic theories to political decision making.

8 0
3 years ago
After cost overruns of the solar project, $10 million was already spent and unrecoverable. It was going to cost $12 million more
Brrunno [24]

Answer:

a. continue with the project provided that the additional solar electricity is worth more than $10 million.

Explanation:

It is provided that after cost overruns of the project is $10 million, which can never be recovered, thus, it is a kind of sunk cost.

Sunk cost is the cost which is made previously, and now in no manner will affect the decision, as cannot be recovered.

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Further provided additional cost will be $12 million, therefore, now the society shall make a rational choice whether to continue the project providing solar electricity of $10 million, as in case of amount of solar energy is $32 million or $22 million, then the choice is obvious to accept,

Rational choice will be for solar electricity worth $10 million.

Therefore, correct statement is

a. continue with the project provided that the additional solar electricity is worth more than $10 million.

4 0
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Obstructionist Stance.

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