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astraxan [27]
3 years ago
9

You find a zero coupon bond with a par value of $10,000 and 30 years to maturity. The yield to maturity on this bond is 5.2 perc

ent. Assume semiannual compounding periods. What is the price of the bond? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Business
1 answer:
muminat3 years ago
7 0

Answer:

The price of the bond is 2143,67

Explanation:

A zero coupon bond is a bond that does not pay coupon payments and instead pays one lump sum at maturity.

Zero coupon bond value= F/(1+r)^t

F = face value or a par value

r= rate of yield per period

t= time to maturity ( in periods)

Replacing

F = $10,000

We assume semiannual compounding periods

r= 5.2/2=2.6

t= 30 x 2=60

Zero coupon bond value= $10,000/(1+0.026)^60

Value = 2143,67

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Distinguishing between employees and independent contractors is important because: Group of answer choices income tax must be wi
vitfil [10]

Answer:

Distinguishing between employees and independent contractors is important because:

employers can defend their noncompliance with employment laws by proving that persons performing work are independent contractors.

Explanation:

Legally, an employer-employee relationship is governed by a contract of service.  This is an agreement between an employer and an employee. The employee does not perform specific tasks or projects, but any tasks assigned to her by the employer from time to time, and she must present at all times to perform the assignment.  On the other hand, the legal relationship between an entity and a self-employed person or an independent contractor is governed by a contract for service.  In a contract for service, the independent contractor engages with the entity to carry out an assigned project  for a fee.

7 0
3 years ago
A stock had a 12 % return last year, a year when the overall stock market declined. Does this mean that the stock has negative b
ludmilkaskok [199]

Answer:

Yes it has a negative beta but this does not translate to very little risk

Explanation:

A negative beta correlation means an investment moves in the opposite direction from the stock market.

A negative beta coefficient does not necessarily mean absence of risk. Instead, negative beta means your investment offers a hedge against serious market downturns.

6 0
3 years ago
Alfonza Incorporated presents its statement of cash flows using the indirect method. The following accounts and corresponding ba
Murrr4er [49]

Answer:

Explanation:

The preparation of the Cash Flows from Operating Activities—Indirect Method is shown below:

Cash flow from Operating activities - Indirect method

Net income $25,400

Adjustment made:

Add: Decrease in accounts receivable $5,000 ($20,000 - $15,000)

Less: Decrease in accounts payable -$450 ($8,750 - $9,200)

Total of Adjustments $4,550

Net Cash flow from Operating activities            $29,950

6 0
3 years ago
Mcewan Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on direct labor-hou
777dan777 [17]

Answer:

Selling price= $10,632

Explanation:

<u>First, we need to calculate the predetermined overhead rate:</u>

Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Predetermined manufacturing overhead rate= (307,200/48,000) + 2.8

Predetermined manufacturing overhead rate= $9.2 per direct labor hour

Job X941:

Total direct labor-hours 300

Direct materials $ 600

Direct labor cost $ 5,500

<u>Now, we can determine the total cost of Job X941:</u>

Total cost= 600 + 5,500 + 300*9.2

Total cost= $8,860

<u>Finally, the selling price:</u>

Selling price= 8,860*1.2

Selling price= $10,632

7 0
4 years ago
.In 2027, instead of cashing in the bond for its then current value, you decide to hold the bond until it doubles in face value
cricket20 [7]

Answer:

The question is not complete,find below complete questions:

If you purchased a $50 face value bond in early 2017 at the then current interest rate of .10 percent per year, how much would the bond be worth in 2027? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. In 2027, instead of cashing the bond in for its then current value, you decide to hold the bond until it doubles in face value in 2037. What annual rate of return will you earn over the last 10 years?

The bond is worth $50.50 in the year 2027

The annual rate of return is 7.07%

Explanation:

The future value of the bond is given by the below formula:

FV=PV*(1+r)^N

where PV  is the present of the bond of $50

r is the rate of return of 0.10 percent=0.001

N is the duration of the bond investment of 10 years

FV=50*(1+0.001 )^10

FV=$50.50

However for the face of the bond to double i.e to $100, the rate of return can be computed thus:

r=(FV/PV)^(1/N)-1

where FV=$100 (double of $50)

FV=$50.50(current value in 2027)

N=10

r=($100/$50.50)^(1/10)-1

r=0.070707543

r=7.07%

5 0
3 years ago
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