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USPshnik [31]
1 year ago
11

on december 31, 2021, interlink communications issued 4% stated rate bonds with a face amount of $110 million. the bonds mature

on december 31, 2051. interest is payable annually on each december 31, beginning in 2022
Business
1 answer:
Bess [88]1 year ago
6 0

Interest - Bond Price is $97.45 million, rounded to the nearest million.



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

To learn more about interest
brainly.com/question/2294792
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Complete Question
On December 31, 2021, Interlink Communications issued 5% stated rate bonds with a face amount of $113 million. The bonds mature on December 31, 2051. Interest is payable annually on each December 31, beginning in 2022. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $). Determine the price of the bonds on December 31, 2021, assuming that the market rate of interest for similar bonds was 6%.

Table values are based on:

n = 30

i = 6%

Cash Flow Amount Present Value

Interest $111,300,000 $74,454,240

Principal $100,000,000 $13,137,000

Price of bonds $87,591,240

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Answer: $171.67 would be the price of the security

Explanation: This problem relates to dividend growth model, which can be shown as follows :-

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where'

d1 = expected dividend

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g = growth rate

therefore,

=\frac{\$5\left ( 1+3\% \right )}{P_{0}}+\:3\%

solving this we get

p_0=\$171.67

8 0
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Why do​ long-run elasticities of demand differ from​ short-run elasticities? ​Long-run elasticities of demand differ from​ short
Ne4ueva [31]

Answer:

The correct answer is option D.

Explanation:

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Durable goods can be used for a relatively long time. So they will have a less elastic demand.

3 0
3 years ago
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Who sets the price in a monopolistic competition?
AnnyKZ [126]

Answer:

Producers

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7 0
3 years ago
The model of competitive markets relies on these three core assumptions:
Vesnalui [34]

Answer:

The three scenarios describe a competitive market.

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Thus, from items 1 and 2, consumers and buyers are price takers, that is, they cannot influence the price determined by the market. Item 3 is about achieving zero profit or normal long-term profit. This is because the free entry and exit of companies avoids extraordinary profits by encouraging companies to migrate to sectors that earn higher profits in the short term. Thus, in perfect competition, compa

7 0
3 years ago
Mapleleaf Industries declared a $0.85 per share cash dividend. The company has 130,000 shares authorized, 51,000 shares issued,
patriot [66]

Answer:

Mapleleaf Industries

Journal Entry

Debit Cash Dividend $40,800

Credit Dividends Payable $40,800

To record the declaration of $0.85 per share cash dividend.

Explanation:

This journal entry shows the two accounts involved and how they are recorded when a cash dividend is declared (declaration date).

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