Question

Calculate the annual interest and the semiannual interest payment for the following corporate bond issues with a face value of $1,000. (round your answers to 2 decimal places.)

Answer 1

The answer to the question is shown below.

What is the Interest rate?

• In finance and economics, interest is the payment of an amount above the repayment of the principal sum (that is, the amount borrowed) by a borrower or deposit-taking financial institution to a lender or depositor at a specific rate by borrower or deposit-taking financial institution.
• It differs from a fee that the borrower may pay to the lender or a third party.
• It is also distinct from a dividend, which is paid by a company to its shareholders (owners) from its profit or reserve, but not at a fixed rate, but rather on a pro-rata basis as a share of the reward gained by risk-taking entrepreneurs when revenue exceeds total costs.

Calculation:

Given -

Annual Interest Rate:

• 5.75%
• 6.40%
• 6.00%
• 7.55%

So, Annual Interest Rate:

• 5.75% = 1000 × 5.75%= 57.50
• 6.40% = 1000 × 6.40%= 64.00
• 6.00% = 1000 × 6.00%= 60.00
• 7.55% = 1000 × 7.55%= 75.50

So, Semiannual Interest Amount:

• 5.75% = 1000 × 5.75%/2 = 28.75
• 6.40% = 1000 × 6.40%/2 = 32.00
• 6.00% = 1000 × 6.00%/2 = 30.00
• 7.55% = 1000 × 7.55%/2 = 37.75

Therefore, the answer to the question is shown below.

Know more about Interest rates here:

brainly.com/question/25793394

#SPJ4

The complete question is given below:

Calculate the annual interest and the semiannual interest payment for the following corporate bond issues with a face value of $1,000. (Round your answers to 2 decimal places.) Find: Annual Interest Amount, and Semiannual Interest Payment

Annual Interest Rate:

5.75%

6.40%

6.00%

7.55%