All categories

1 year ago

Uan zhang bought a 10-year bond that pays 8.25 percent semiannually for $911.10. what is the yield to maturity on this bond?

Business

1 answer:

IceJOKER [234]1 year ago

6 0

Using the trial-and-error method, this bond's yield to maturity is 9.66 percent.

<h3></h3><h3>What do bonds do?</h3>

An IOU-like debt security called a bond. Bonds are issued by borrowers to attract capital from investors ready to extend a loan to them for a specific period of time. When you purchase a bond, you are making a loan to the issuer, which could be a corporate, government, or municipality. Bonds are fixed-income securities that reflect loans from investors to borrowers (typically corporate or governmental).

As stated in the assertion

We have stated that Uan zhang purchased a 10-year bond with a 6.5% interest rate.

We also need to determine this bond's yield to maturity.

In order to achieve this,

There is a donation of $911 10.

n = 10 years until maturity

Rate of interest = C = 8.25%

Semi-annual coupon: $1,000 divided by 0.0825/two equals $41.25.

I = yield to maturity

Bond present value = PB = $911.10

To find YTM, use the trial-and-error method. We can infer that the yield to maturity is greater than the coupon rate because the bond is being sold at a discount.

YTM = 9.4%

= $522.90 + 391.54 ≅ $914.43

About 9.66 percent of the YTM is present.

Calculating the exact YTM using a financial calculator yielded a result of 9.656 percent (2 4.828%).
So, using the trial-and-error method, this bond's yield to maturity is 9.66 percent.

To learn more about the sum, refer to:

brainly.com/question/17695139

#SPJ4

You might be interested in

g Profit margins tend to peak during the growth stage of the Product Life Cycle. This is due to ___________________.this being t

DIA [1.3K]

Answer:

Declining unit manufacturing costs while prices can remain high.

Explanation:

A product life cycle can be defined as the stages or phases that a particular product passes through, from the period it was introduced into the market to the period when it is eventually removed from the market.

Generally, there are four (4) stages in the product-life cycle;

1. Introduction.

2. Growth.

3. Maturity.

4. Decline.

Generally, the growth stage is the stage where the product gains acceptance from the consumer and there is a significant increase in demand and sales.

Profit margins tend to peak during the growth stage of the Product Life Cycle. This is due to declining unit manufacturing costs while prices can remain high because the product has been accepted in the market and its unit cost of production is lesser i.e they are manufactured in bulk.

5 0

3 years ago

The gap between the official rate and the broader rate changes over the course of the business cycle. more specifically, during

Serggg [28]

The space between the official rate and the broader fee modifications over the path of the business cycle. greater specifically, for the duration of the gap is probable to the exertions marketplace is beneath strain.

Legit trade price refers back to the alternate fee determined by way of country-wide government or to the rate decided inside the legally sanctioned exchange marketplace. it's far calculated as an annual average primarily based on month-to-month averages (neighborhood currency devices relative to the U.S. dollar).

The official rate refers to the exchange charge determined via national authorities or to the fee decided within the legally sanctioned trade market. it is calculated as an annual common based totally on monthly averages (nearby forex units relative to the U.S. greenback).

Official rate: The legitimate exchange rate is the price of change announced by using a country's foreign exchange administration. typically used by countries with strict foreign exchange controls. market fee: The marketplace alternate price refers to the actual alternate charge for trading foreign exchange inside the loose market.

Learn more about official rate here: brainly.com/question/25970050

#SPJ4

4 0

2 years ago

Kenneth, the plant manager, was talking with another manager about Brendan, the lead engineer in the corporate R & D departm

Alexxx [7]

The correct answer is D) a narrow perspective.

Kenneth, the plant manager, was talking with another manager about Brendan, the lead engineer in the corporate R & D department. Kenneth remarked, "Brendan is so bright, and he is an expert in designing products. But like so many experts, he can’t imagine what it’s like to be as ignorant as the rest of us. I think at times, he cannot see things from an outsider’s perspective."

Brendan is suffering from a narrow perspective.

The narrow perspective means that an individual is so focused on their own things, that forgets the general picture of things and that the fact that other people can have a different view and opinion about a certain topic. That is why Kenneth, the plan manager, thinks about Brendan. So brilliant but he is not considered enough of the other people's limitations on the subject or other peoplés perspectives.

6 0

3 years ago

During 2019, John was the chief executive officer and a shareholder of Maze, Inc. He owned 60% of the outstanding stock of Maze.

harina [27]

Answer:

Throughout the clarification segment elsewhere here, the definition of the concern is outlined.

Explanation:

Yes, Mr. John becomes qualified to something like a bad debt benefit for the balance including its interest made on either the loan.
Although Maze is obligated to declare the same here in his tax filing throughout respect including its loan lent over him from the United National Bank mostly as professional and non-borrower.

8 0

3 years ago

Lets say you were a teacher. If parent approaches you to encourage you to give information about another child, what should you

elena55 [62]

first of all I will ask the parents what's the matter, if they explain me then also I will not going to give the child's information, I will contact to the principal about this matter and school management will look out at this matter.

5 0

3 years ago