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jeka94
3 years ago
6

A bond with a $1,000 face value and an 8 percent annual coupon pays interest semiannually. The bond will mature in 15 years. The

yield to maturity is 11 percent. The price of the bond should be: Do no round intermediate computations. Round the final answer to two decimal places.
Business
1 answer:
Keith_Richards [23]3 years ago
7 0

Answer:

$781.99

Explanation:

The price of the bond can be computed using excel pv function given below:

=-pv(rate,nper,pmt,fv)

rate is the semiannual yield to maturity i.e11%*6/12=5.5%

nper is the number of semiannual coupons the bond would i.e 30 semiannual coupons in 15 years

pmt is the amount of semiannual coupon=$1000*8%*6/12=$40

fv is the face value of $1000

=-pv(5.5%,30,40,1000)=$781.99  

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4 0
3 years ago
Finding the required interest rate: Your parents will retire in 18 years. They currently have $250,000, and they think they will
Salsk061 [2.6K]

Answer:

i= 8% annual compunded

Explanation:

Giving the following information:

Your parents will retire in 18 years. They currently have $250,000, and they think they will need $1,000,000 at retirement.

We need to calculate the interest rate required to reach the $1 million goal in 18 years without any additional deposit.

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Isolating i:

i= [(FV/PV)^(1/n)] - 1

i= [(1,00,000/250,000)^(1/18)] - 1= 0.08

i= 8% annual compunded

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3 years ago
when the percentage change in the price is greater htan the resulting percentage change in quantity demanded,
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7 0
2 years ago
robert jacobs and richard chase (2018). operations and supply chain management, 16th edition, mcgraw-hill. isbn 978-1-260-23890-
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1 year ago
Which of the following is true of entrepreneurial organizational structures? Choose all that apply.
frosja888 [35]

Answer: A. They are flat.

C. They are common to start-up businesses.

D. A single leader makes most decisions.

Explanation:

Entrepreneurial business structure is a structure whereby, the owner of the bsuniess makes every decisions. It is often a start up company or a small company and there's a direct mean of communication as the owner has few workers.

The structure is typically flat and the roles are not well defined. It also give rooms for promotion of ideas as workers can give opinions on certain issues.

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