The value of bond 3 is RM1137.65
This bond 3 is selling at a premium since the coupon rate(14%) is higher than the required rate(12%) orSince the bond value(1137.65) is more than its par value(1000)
Bond 3:
Coupon rate = 14% = 0.14
Coupon payment = Coupon rate*Face value/ Number of compounding periods in a year
CPN = 0.14*1000/2 = 140/2 = 70Number of years till maturity = 15 years
Number of periods till maturity = N = 15*2 = 30
We know that the price of the bond is given by the following formula,
P = CPN*(1/y)*(1-(1/(1+y)^N)) + FV/(1+y)^N
Substituting the given values in the above equation,
we get
P = 70*(1/0.06)*(1-(1/(1+0.06)^30)) + 1000/(1+0.06)^30
P = 70*(1/0.06)*(1-(1/(1.06)^30)) + 1000/(1.06)^30
P = 70*(16.6667)*(1-(0.943396)^30) + 1000*(0.943396)^30
P = 70*(16.6667)*(1-0.17411) + 1000*(0.17411)
P = 70*(16.6667)*(0.82589) + 1000*(0.17411)
P = 963.54 + 174.11
P = 1137.65
Learn about the rate of return here:brainly.com/question/24301559#SPJ1
Answer: it would be engaging in currency hedging
Explanation: currency hedging explains the act of entering into a financial contract in order to protect against unexpected, expected or anticipated changes in currency exchange rates.
Answer:
$1.78 per share
Explanation:
The computation of the earning per share in case of the boom is shown below:
In case of normal, the EBIT is $73,800
Since the EBIT is increase by 20%
So New EBIT is
= $73,800 × 120%
= $88,560
And, the net income is
= EBIT × (1 - tax rate)
= $88,560 × (1 - 0.34)
= $58,449.60
Now EPS is
= Net income ÷ outstanding shares
= $58,449.50 ÷ 32,900 shares
= $1.78 per share
