1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Arada [10]
3 years ago
5

A 13-year bond of a firm in severe financial distress has a coupon rate of 10% and sells for $930. The firm is currently renegot

iating the debt, and it appears that the lenders will allow the firm to reduce coupon payments on the bond to one-half the originally contracted amount. The firm can handle these lower payments. What are the stated and expected yields to maturity of the bonds? The bond makes its coupon payments annually.
Business
1 answer:
adoni [48]3 years ago
3 0

Answer:

Stated yield is 11.04%

expected yield is  5.78%

Explanation:

The expected yield to maturity can be computed using the rate formula in excel which is given below:

=rate(nper,pmt,-pv,fv)

nper is the number of coupon interest the bond would pay which is 13

pmt is the amount of coupon interest the bond pays which is $1000*10%=$100

pv is the current price of the bond which is $930

fv is the face value of $1000

=rate(13,100,-930,1000)=11.04%

However the expected yield has the coupon interest reduced to one -half as calculated below:

=rate(13,100*0.5,-930,1000)=5.78%

You might be interested in
A local farmer grows and sells corn and pumpkins to the local grocers. Look at the farmer's business as a system. In which categ
weeeeeb [17]

Answer:

The right answer will be the "Transformational process".

Explanation:

  • Improvements in such a wide variety of organizations that increase the member of staff as well as the involvement including its leadership throughout the business expansion.
  • A transformational process should give vitality to a struggling organization and therefore can enhance the proper functioning of any enterprise.
6 0
3 years ago
What is our planet called?
laila [671]

Answer:

Earth

Explanation:

4 0
3 years ago
Read 2 more answers
.. Will has a Personal Auto Policy. Which of the following cars would qualify for coverage as a "temporary substitute" under Wil
Leokris [45]

Answer:

Will rents a car while his car is in the shop.

Explanation:

If Will has his car in the workshop and has a Personal Auto Policy, then he can claim a temporary substitute while his car is being repaired.

A temporary subsititute is defined as an automobile that a person with an insurance policy uses in the interim when their vehicle is being repaired, has broken down, has suffered loss, or is being serviced.

Will borrowing a car while his own is in the shop is considered temporary substitution.

3 0
3 years ago
What is technical profession?Give examples.​
guapka [62]

Answer:

Technical profession is a highly skill based profession in which a practical knowledge is required.Example:engineering in civil,mechanical,computer e.t.c.

6 0
3 years ago
The following data apply to Elizabeth's Electrical Equipment:
Romashka [77]

Answer:

$50

Explanation:

Calculation to determine the intrinsic per share stock price be immediately after the repurchase

First step

Total Assets=Value of operations of 20,000+ Short term investments of 1000

Total Assets=$21,000

Second step

Equity =Assets - Debt

Equity= $21,000-$6,000

Equity= $15,000

Now let determine the intrinsic per share stock price

Intrinsic per share stock price=$15,000/300

Intrinsic per share stock price=$50

Therefore the Intrinsic value per share will be $50 immediately after the repurchase has occured.

7 0
3 years ago
Other questions:
  • Hi I need help for this please help me out... this is my final week Assignment it's a career course, I don't want to fail!!! I w
    8·1 answer
  • ____ evaluation methods use some measurable quantity as the basis for assessing performance.
    10·1 answer
  • __________ are not one of the types of engagements and related forms of conclusions that are defined by the attestation standard
    7·1 answer
  • Clara is suing David because of a property dispute. Clara and David are from different states, so it is not readily clear which
    5·1 answer
  • Financial leverage: Group of answer choices is the ratio of a firm's revenues to its fixed expenses. is equal to the market valu
    15·1 answer
  • There has been a recall on one of the products your company manufactures. The company fears that if it has to replace too many o
    8·1 answer
  • What makes sure that the aesthetic and functional aspects of the button work in the context of the rest of the product
    5·1 answer
  • When a manager makes scheduling decisions, he or she is making __________,
    15·1 answer
  • Suppose that an Exxon Mobil bond has a return of ​% half the time and ​% the other half. The expected return on this bond is   
    12·1 answer
  • Taxpayers have a choice of deducting the standard deduction or their itemized deductions. therefore, blank______ agi deductions
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!