Can someone assist with my question.... really important, semester coming up soon. Thank you in advance

Suppose a -year, bond with annual coupons has a price of and a yield to maturity of . What is the bond's coupon rate? The cou

kari74 [83]

Complete Question:

Suppose a five-year, $1000 bond with annual coupons has a price of $903.35 and a yield to maturity of 5.6%. What is the bond's coupon rate?

Answer:

3.396% Approximately

Explanation:

We can calculate the coupon interest by using the formula given in the attachment.

Now, here we have:

F is the Face value which is $1000

P is the price of the bond which in this case is $903.35

C is the Coupon interest

n are the number of years which is 5 years in this case

Yield to Maturity is 5.6%

By putting the values in the given equation we have:

5.6% = [C + ($1000 - $903.35)/5 years] / [($1000 + $903.35)/2]

5.6% = [C + 19.33] / [951.675]

0.056 * 951.675 = C + 19.33

53.2938 = C + 19.33

C = 53.2938 - 19.33

C = $33.96 approximate estimate.

Now we will find the coupon rate by using the following formula:

Coupon Rate = Coupon Interest / Face Value

By putting values, we have:

Coupon Rate = $33.96 / $1000 = 3.396% Approximately.

Accurate Coupon interest can be calculated using excel. The above answer gives minor difference in decimal points.

6 0

3 years ago

What property describes the number sentence 6+0=6

Vika [28.1K]

Six pluse zero equal six

6 0

3 years ago

Jimmy Company’s cash balance at the end of the month was $8,500. After comparing the company’s records with the monthly bank sta

Elodia [21]

Answer:

The answer is C) $7,970.

Explanation:

We have 04 reconciling items as below:

- Outstanding checks $800: this amount was already recorded in the Cash account of the company once the check was written; thus, the Cash ending balance has already reflected this amount.

- Deposits in transit $700: this amount was already recorded in the Cash or Cash-equivalent account of the company once the deposit was made; thus, the Cash ending balance has already reflected this amount.

- Bank service charge $30: fees paid to banking activities and are deducted without informing to the company. Thus, this deduction in cash is not reflected in the Cash account.

- NSF check $500: this was recorded as the increase in Cash account by the company once the check was written by the person/entity to the company. However, the writer's account balance was not sufficient to honor this check amount to the company; thus Cash Account at the end of the period should reduced by $500. Instead, this $500 may be recorded in Account Receivable account.

Thus, the adjusted cash balance = 8,500 - 30 - 500 = $7,970.

7 0

4 years ago

I need a sentence with the word carbon offset in it

Digiron [165]

After having consumed electricity and producing carbon dioxide, I made up for it by buying Carbon Offsets.

3 0

3 years ago

Read 2 more answers

Which of the following is true of an unsecured loan?

Ilya [14]

The statement "The value of an item where the borrowers owned but they are not at the repossession risk" is to be true.

The unsecured loan is the type of loan in which there is no need for any type of collateral property.

The lender does not takes the assets of the borrower as the security but it gives the approval of an unsecured loan depends upon the creditworthiness of the borrower.

Examples are:

Personal loans.
Students loans.
Credit cards.

The following information related to unsecured loans is

It does not for cars, houses, or any other large purchases
In this, the collateral does not involve.
It contains high interest.

Therefore we can conclude that, option d is correct.

Learn more about the unsecured loan here: brainly.com/question/8347317

7 0

3 years ago

Read 2 more answers