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marissa [1.9K]
3 years ago
13

Sadik Inc.'s bonds currently sell for $1,180 and have a par value of $1,000. They pay a $105 annual coupon and have a 15-year ma

turity, but they can be called in 5 years at $1,100. What is their yield to call (YTC)?

Business
1 answer:
mr Goodwill [35]3 years ago
7 0

Answer:

7.74%

Explanation:

In this question, we use the Rate formula which is shown in the spreadsheet.  

The NPER represents the time period.  

Given that,  

Present value = $1,180

Assuming figure - Future value or Face value = $1,100  

PMT = $105

NPER = 5 years

The formula is shown below:  

= Rate(NPER;PMT;-PV;FV;type)  

The present value come in negative  

So, after solving this, the answer would be 7.74%

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3 years ago
The equilibrium price and quantity of a good are found where the supply and demand curves intersect.
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A company launched four new products. The market price, in dollars, of the four products after different number of years is show
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Suppose the economy is operating at an output level of $5,400 billion. Assume furthermore that potential output is $5,000. Which
olga2289 [7]

Answer:

The government should decrease spending by $100 billion.

Explanation:

The potential output level of an economy is $5,000 billion.  

The economy is operating at an output level of $5,400 billion.  

We see that there is an inflationary gap of $400 billion as the economy is operating at an output level of $400 billion more than the potential output level.  

The marginal propensity to consume is 0.75.  

ΔY = \frac{1}{1 - MPC}\ \times\ \Delta G

$400 billion = \frac{1}{1 - 0.75}\ \times\ \Delta G

ΔG = \frac{400}{4}

ΔG = $100 billion

4 0
2 years ago
Identify whether each of the following statements best illustrates the concept of consumer surplus, producer surplus, or neither
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Answer:

neither

producer surplus

consumer surplus

Explanation:

Consumer surplus is the difference between the willingness to pay of a consumer and the price of the good.

Consumer surplus = willingness to pay – price of the good

Producer surplus is the difference between the price of a good and the least price the seller is willing to sell the product

Producer surplus = price – least price the seller is willing to accept

The first scenario is neither a producer or consumer surplus because a transaction did not take place

The second scenario is a producer surplus.

the producer surplus = 60 - 55 = 5

The third scenario is a consumer surplus

consumer surplus = $114 - $107 = $7

6 0
2 years ago
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