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zavuch27 [327]
3 years ago
5

The current​ zero-coupon yield curve for​ risk-free bonds is as​ follows: Maturity ​(years) 1 2 3 4 5 YTM 5.05 % 5.49 % 5.78 % 5

.93 % 6.09 % What is the price per $ 100 face value of a​ four-year, zero-coupon,​ risk-free bond?
Business
1 answer:
kondor19780726 [428]3 years ago
7 0

Answer:

The answer is $79.42

Explanation:

Zero-coupon bonds does not make any periodic payments of interest. It pays both the interest and the face value at maturity.

N(Number of periods) = 4 years

I/Y(Yield to maturity) = 5.93 percent

PV(present value or market price) = ?

PMT( coupon payment) = 0

FV( Future value or par value) = $100

We are using a Financial calculator for this.

N= 4; I/Y = 5.93; PMT = 0; FV= $100; CPT PV= -79.42

Therefore, the market price of the bond is $79.42

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I got a 50 the first time taking this, don’t know what I got wrong.
loris [4]

Answer:

Price elasticities of demand and supply

Explanation:

Tax is a compulsory amount levied on goods and services by the government  or an agency of the government.

taxes increases the prices of goods and services

Deadweight loss of tax refers to a reduction in quantity demanded and supplied as a result of tax.

Price elasticity of demand measures the responsiveness of quantity demanded to changes in price of the good.

Price elasticity of supply measures the responsiveness of quantity supplied to changes in price of the good.

If demand or supply is elastic, the deadweight loss of tax is higher. If demand or supply is inelastic, the deadweight loss of tax would be lower.

8 0
3 years ago
Janet is planning to purchase the stock of Mortensen Petro, Inc. She expects the stock to pay a $1.98 dividend next year, and sh
Arada [10]

Answer: Current Price $26.65

Explanation:

Rate of return = 12.5%

dividends = $1.98

Expected Price (in a year from now) Pe= $28

Current price = Pc

R = (Pe - Pc + D)/Pa

0.1250 = (28 - Pc + 1.98)/Pc

28 - Pc + 1.98 = 0.1250Pc

-Pc - 0.1250Pc = - 28 - 1.98

- 1.125Pc = -29.98

 Pc = -29.98/(-1.1250Pc) = 26.64888889

 Pc = $ 26.65

7 0
3 years ago
Sales revenue
Ne4ueva [31]

Answer:

may be recorded before cash is collected.

Explanation:

Sales revenue "may be recorded before cash is collected."

This is according to Accrual accounting, which unlike the cash model that requires payments to be made before sales revenue is recorded.

In the Accrual accounting model, sales revenue recording is not based on cash collection before it is recorded. Here, the revenue is recorded in as much the transferred goods are made and collection of payment is determined or expected.

4 0
3 years ago
Use the following items to determine the toata assets ,total liabilities , net worth , total cash inflows and total cash outflow
kicyunya [14]

Answer:

Determining the total assets, total liabilities, net worth, total cash inflows, and total cash outflows:

1. Total assets

Cash in checking account         $ 450

Savings account balance        $ 1,890  

Current value of automobile  $8,800  

Household possessions           3,400

Video equipment                  $ 2,350

Personal computer               $ 1,200

Value of stock investment        860

Total assets                         $18,950

2. Total liabilities

Rent for the month              $ 650

Balance of educational loan 2,160

Credit card balance             $ 235

Total liabilities                  $3,045

3. Net worth

Total assets                      $18,950

Total liabilities                   ($3,045)

Net worth                        $15,905

4. Total cash inflows

Monthly take-home salary $ 2,185

5. Total cash outflows

Spending for food                  $ 345

Telephone bill paid for month    65

Loan payment                             80

Auto insurance                     $ 230  

Payment for electricity               90

Lunches/parking at work     $ 180

Donations                                160  

Clothing purchase               $ 110

Restaurant spending             130

Total cash outflows         $1,390

Explanation:

a) Data and Calculations:

Rent for the month $ 650

Monthly take-home salary$ 2,185

Spending for food $ 345

Cash in checking account$ 450

Savings account balance $ 1,890

Balance of educational loan 2,160

Current value of automobile $8,800

Telephone bill paid for month 65

Credit card balance $ 235

Loan payment 80

Auto insurance $ 230

Household possessions 3,400

Video equipment $ 2,350

Payment for electricity 90

Lunches/parking at work $ 180

Donations 160

Personal computer $ 1,200

Value of stock investment 860

Clothing purchase $ 110

Restaurant spending 130

3 0
2 years ago
The interest yields on U.S. Treasury securities in early 2009 fell to very low levels as a result of the combined events surroun
Leni [432]

Answer and Explanation:

The computation is shown below:

For three months

Simple yield is

= Discount ÷ Price at sale

= 6.07 ÷ 9993.93

= 0.0607%

And, the annualized yield is

= 0.0607% ÷ 3 × 12

= 0.2428%

For 6 months

= Discount ÷ Price at sale

= 23.07 ÷ 9976.74

= 0.2312%

And, the annualized yield is

= 0.2312% ÷ 6 × 12

= 0.4625%

4 0
3 years ago
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