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olga_2 [115]
3 years ago
9

will issue a new 10 year AA rated corporate bond with a coupon rate of 7.00%. The bond pays interest semi-annually and has a fac

e value of $ 1,000. If existing AA corporate bonds with 10 years to maturity have a yield to maturity of 5.00%, what will be the discount or premium of JAN Corp.’s bond relative to its face value.
Business
1 answer:
9966 [12]3 years ago
6 0

Answer:

The bond is sold at a premium of $1155.89 -$1000 = $155.89

Explanation:

N = 10 years * 2 semiannual =20 payments of interest

coupon interest = 7% /2 =  0.035

market interest = 5% /2 = 0.025

interest = 1000*0.035 = $35 per semiannual

Pv interest for interest = [1-1/(1+0.025)^20]0.025 = 15.89 * $35 = $545.62

Pv for capital = 1000/(1+0.025)^20 = $610

value of the Bond = 610.27+ 545.62 = 1155.89

The market rate is less than the coupon rate meaning the bond is traded at a premium

Pv factor for many years = [1-1/(1+r)^n]/r

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Just before the outbreak of the Corona virus you bought a stock expected to pay a constant dividend (without growth) once every
zalisa [80]

Answer: 9.3%

Explanation:

If the company continues to payoff its dividend at current rate, then the price of stock will be:

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Now, when the company isn't expected to pay any dividends for the next two years, the price of stock at the end of year 2 will be:

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= 20/1.1025

= 18.14

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8 0
3 years ago
Lisa sells business property with an adjusted basis of $237,800 to her son, Alfred, for its fair market value of $190,240.
mylen [45]

Answer:

a. Lisa's realized and recognized gain or loss is unknown

b. Alfred's recognized gain of $71,340 if he subsequently sells the property for $261,580

Alfred's recognized  loss of $35,670 if he subsequently sells the property for $154,570

Explanation:

a. We do not know the amount Lisa costed to buy this business property, thus can't define her gain or loss.

b. Alfred cost $190,240 to buy this property, the he will gain if sell higher or lost if sell lower.

The gain $71,2340 = selling price $261,580 - cost $190,240

The loss $35,670 = selling price $154,570 - cost $190,240

6 0
3 years ago
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aev [14]
Market and command economy
5 0
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inn [45]

Answer:

D) overemphasizing some issues and underemphasizing others

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Apparently Ms. Bisset has a lot of good qualities as an employee and human being, but her supervisor, Mr. Reber is behaving as if all her actions were great, when they are not. Generally performance appraisals do not focus on only one activity or performance measurement, it is more like a weighted appraisal. But that doesn't mean you should focus only on the tasks that you want an forget about the rest.

It is very uncommon that someone will do great n every single aspect or category, e.g. good salespeople are very competitive and depending on how sales are distributed (by sector, region or not differentiated at all) may not be very social or hopeful with their coworkers. People who like accounting are boring, no one is perfect.

The problem here is that Mr. Reber likes Ms. Bisset a little too much, and he is considering only her good qualities as important, when a salesperson can have many defects, but he/she must be able to sell. It's like a pitcher that cannot pitch, they are useless for that position. Maybe she could work somewhere else in the company that better fits her abilities.

7 0
4 years ago
When a research project includes the collection of biological samples, all planned future uses of the samples, identifiers, and
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