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Lelu [443]
3 years ago
8

Assume that a $1,000,000 par value, semiannual coupon US Treasury note with four years to maturity has a coupon rate of 4%. The

yield to maturity (YTM) of the bond is 7.70%. Using this information and ignoring the other costs involved, calculate the value of the Treasury note: $874,669.10 $551,041.53 $743,468.74 $1,049,602.92
Business
1 answer:
ExtremeBDS [4]3 years ago
6 0

Answer:

Explanation:

the present value of the future cash flows is the the value of the bond we calculate the present value as follows

Cash flow  4% = 40000 per year for 4 year p.v using annuity

Cash flow = 1000000 at year four present value using compound formula

Present value at yield rate 7.7%

Cash flow Discount Factor Present Value

1000000 0.743253883           743253.8831

40000         3.334365155           133374.6062

                                            876628.4893

Compound = 1000000/(1+7.7%)^4

Annuity       = 40000*  (1-(1+7.7%)^-4) / 7.7%

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A company has 975 shares of $50 par value preferred stock outstanding. and the call price of its preferred stock is $64 per shar
svetlana [45]

Answer:

book value = $35.64

so correct option is b. $35.64

Explanation:

given data

no of shares =  975 shares

preferred stock outstanding = $50

preferred stock = $64 per share

common stock outstanding = 11,000 shares

total value equity = $440,800

to find out

book value per common share

solution

we get here book value per common share that is express as

book value = ( Total value equity - Preferred Stock Book Value) ÷ Common Stock Outstanding    ...................1

put here value we get

here Preferred Stock Book Value = no of shares × preferred stock outstanding

Preferred Stock Book Value = 975 × 50 = $48750

so book value will be

book value = \frac{440800-48750}{11000}

book value = $35.64

so correct option is b. $35.64

8 0
3 years ago
Neither payback period nor discounted payback period techniques for evaluating capital projects account for: Group of answer cho
vekshin1

Answer: C. cash flows that occur after payback.

Explanation:

The Payback Period and Discounted Payback Period capital budgeting evaluation techniques are used to find out how long it will take for an investment to pay back it's initial outlay.

Once this point is gotten to however, the method stops working and as such does not take into account cashflows after the Payback period has been reached. This means that the method does not cater for profit but rather for Break-Even points alone which can be very unattractive because people embark on capital projects mostly to make profits.

5 0
3 years ago
TRUE/FALSE. if the marginal cost of the 10th unit of output is $15 and the average total cost of the 10th unit of output is $15,
Lubov Fominskaja [6]

Average total cost is minimized at 10 units of output.
As per the relationship between the two, at such a point average cost is the lowest and after that, from the next unit onwards it starts rising.

<h3>By marginal cost, what do you mean?</h3>

The term "marginal cost" describes the rise in manufacturing costs brought on by the creation of more product units. A different name for it is the marginal cost of production. Businesses may evaluate how volume produced affects cost and, eventually, profitability by calculating the marginal cost.

<h3>What does "total average cost" mean?</h3>

The average total cost is calculated by dividing the total cost of production by the total output. In other words, the average cost is the sum of the firm's total fixed and variable costs divided by the sum of the units it produces.

Learn more about marginal cost here:
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3 0
1 year ago
A physical inventory of Liverpool Company taken at December 31 reveals the following.
zubka84 [21]

Answer

The answer and procedures of the exercise are attached in the following archives.

Step-by-step explanation:

You will find the procedures, formulas or necessary explanations in the archive attached below. If you have any question ask and I will aclare your doubts kindly.  

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8 0
3 years ago
3. high quality is not necessarily related to price. discuss this, drawing from your own knowledge and experience, and provide e
pashok25 [27]

High quality is not necessarily related to price. discuss this, drawing from your own knowledge and experience, and provide examples where this may and may not be true. high quality is not necessarily related to price. <u>quality assurance.</u>

The Quality to Price Ratio (or QPR as it is commonly known) is a commonly used concept in the wine industry. Essentially, it's just a measure of perceived value, the enjoyment you're weighing against the price you're paying.

If the price is low, a small change in price equates to a large change in quality. At higher prices, small price changes correspond to small quality changes. However, in all cases, the higher the price, the higher the quality level.

The price-quality matrix designed by Philip Kotler focuses on the cross-section between his two metrics that give the model its name. By positioning a product or service relative to its competitors, retailers can position themselves in the market based on the price and quality of each item.

Learn more about quality prices here:

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7 0
1 year ago
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