1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
pentagon [3]
1 year ago
14

A 5-year bond with a 10% coupon rate was purchased at $980 at issue and sold at $1020 by end of year 4. What is the investor's y

early rate of return? How does it compare to coupon rate and YTM?
Use a financial calculator and Excel to solve it
Business
1 answer:
Dimas [21]1 year ago
6 0

The yearly return of the investor is given to be 11.069%

<h3>How to find the YTM</h3>

In order to do this we have to make use of the Rate function in excel

This would be given as

=RATE(nper, PMT, PV, FV)

where Nper is 5 years

PMT is = $1,000*10% = $100

PV = $980

The future value Fv is given as $1,000

Hnece we would have to type in excel

RATE(5,100,-980,1000)

This would give us the value of the YTM as 10.5348%

Next would be to find the rate of return of this investor. This would be the rate that he actually earned.

We would also use the rate function

=RATE(nper, PMT, PV, FV

Npe = 4 years

PMT = $1,000*10% = $100

PV = $980

FV = $1,020 that is the amount for which the bond was sold

=RATE(4,100,-980,1020)

The solution would be = 11.0698%

Thus we can say that the return earned on investment is 11.0698%

Read more on YTM here

brainly.com/question/26376004

#SPJ1

You might be interested in
Ben Lieber is a waiter at Harbor House, where he receives a weekly wage of $80 plus tips for a 40-hour workweek. Lieber's weekly
Dmitriy789 [7]

Answer:

$290

Explanation:

Fair labour standards act is a Federal law that specifies minimum wage, overtime pay eligibility, child labour standards, and record keeping which affects employees of both private and government institutions.

The Fair labour standards act state that the minimum wage an employee should collect per hour is $7.25.

So for a 40 hour week the minimum wage for Ben Lieber is 7.25* 40= $290

Provisions for FLSA include minimum wage payment, exemption from overtime, minimum wage for workers that provide companionship services, and exemption for worker that do computer related jobs.

4 0
3 years ago
1. What is capital ?
Vlad1618 [11]
Capital is a different way to call Money
6 0
3 years ago
Asset A and B have expected returns of 5% and 3% per year respectively. Their annual volatilities are both 20% and the correlati
Novay_Z [31]

Answer:

1. Weight of A=0.5, Weight of B= 0.5

2. Asset A has the highest shape ratio. The weight of A and B in the optimal risky portfolio that has the highest shape ratio is:

Weight of A= 0.105, Weight of B= 0.895

Explanation:

Expected return of Asset A= 5%Expected return of Asset A= 5%

Expected return of Asset B= 3%

Annual volatilities of Asset A= 20%

Annual votalities of Asset B= 20%

1. Correlation coefficient = 30% = 0.3 < 1

Risk Free Rate = 1% =0.01

1. Weight of A and B in portfolio with minimal risk is:

Weight of A= β^2B - Cov (XAXB) /β^2A + β^2B - 2Cov (XAXB)

Therefore,

CovXAXB = PAB (Volatility of A) (Volatility of B)

= 0.3 × 0.2 × 0.2

= 0.012

Hence,

Weight of A= (0.2)^2 - 0.012 / (0.2)^2 + (0.2)^2 - 2(0.012)

Weight of A= 0.04 - 0.012 / 0.04 + 0.04 - 0.024

= 0.028/ 0.08 - 0.024

= 0.028/ 0.056

=0.5

Weight of A = 0.5

Weight of B= 1 - Weight of A

Weight of B= 1 - 0.5

Weight of B= 0.5

2. Shape ratio of A= RA - Rf / β

= 0.05 - 0.01 / 2

= 0.04/2

= 0.02 =20%

Shape ratio of B= RB - Rf / β

= 0.03 - 0.01/ 2

0.02 / 2

=0.01 = 10%

So, Asset A has the highest shape ratio

Cov (XAXB) = PAB (Volatility of A) (Volatility of B)

= 0.03 × 0.2 × 0.1

= 0.006

Weight of A= β^2B - Cov (XAXB) /β^2A + β^2B - 2Cov (XAXB)

Weight of A = (0.1)^2 - 0.006 / (0.2)^2 + (0.1)^2 - 2(0.006)

= 0.01 - 0.006 / 0.04 +0.01 - 0.012

= 0.004/ 0.05 - 0.012

= 0.004/ 0.038

= 0.105

Weight of A = 0.105

Weight of B= 1 - 0.105

Weight of B= 0.895

3 0
3 years ago
_____ is the marketing of goods and services to individuals and organizations for purposes other than personal consumption.
azamat

Answer:

C) Business marketing

Explanation:

There are two major types of business transactions: business to business (B2B) and business to consumers (B2C).

When a company engages in B2B transactions, they are selling their products or services to another business or individual that will resell them to individual consumers. For example, Nike sells shoes to Foot Locker, and then Foot Locker resells them to final consumers.

Businesses engaged in B2B transactions use specific marketing strategies aimed at their wholesale clients which usually vary from marketing strategies aimed at final consumers, e.g. offer discounts for buying in bulk.

3 0
3 years ago
Read 2 more answers
Laura, a sales manager at Dexter Inc., claims that labor and management are rivals for most organizations. Brooke, the HR manage
Afina-wow [57]

Answer:

Dexter Inc.

The statement that best supports Brooke's perspective is:

Examples of cooperation between labor and management include employee involvement in decision making and self-managing teams.

Explanation:

When labor and management act as rivals or adversaries, it does not benefit their organizations.  They should find common grounds for cooperation.  Organizations should involve their employees in more decision-making.  Despite their incongruent goals, unions and management should find win-win solutions.  Paying employees a living wage does not impoverish the organization.  On the contrary, everybody is greatly enriched.

3 0
3 years ago
Other questions:
  • Suppose a commercial banking system has $240,000 of outstanding checkable deposits and actual reserves of $85,000. If the reserv
    10·1 answer
  • Which do you like better guys DELTARUNE or UNDERTALE?
    8·2 answers
  • To minimize current and future funding risks, program management offices use __________________ to project and track obligations
    11·1 answer
  • Which subject line will likely result in grabbing readers' attention? a.Carpool and Vanpool Opportunity b.Our Sustainability Eff
    7·1 answer
  • Which part of the management of an organization would be MOST involved with strategic leadership?
    11·1 answer
  • Strafford Inc. elected to use the nature of distribution approach for distributions from its equity-method investment purchased
    12·1 answer
  • Journal entries of hari started business with cash and goods​
    7·1 answer
  • Events concerning the Mi'kmaw self regulated lobster fishrey in relation to the treaties
    10·1 answer
  • A useful way of standardizing financial statements is to choose a ____ and then express each item relative to the _____.
    9·1 answer
  • Employer-sponsored retirement plans requiring a minimum length of time of service to participate are.
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!