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Lera25 [3.4K]
3 years ago
5

Suppose a $1,000 bond pays $40 per year in interest. Instructions: In part a, round your response to one decimal place. In part

b, round your response to two decimal places. a. What is the contractual interest rate ("coupon rate") on the bond? 4 % b. If market interest rates rise to 5 percent, what price will the bond sell for? $
Business
1 answer:
Lubov Fominskaja [6]3 years ago
5 0

Answer:

The correct answer for option (a) is 4% and for option (b) is $800.

Explanation:

According to the scenario, the computation for the given data are as follows:

Face value = $1,000

Annual interest = $40

Interest rate = 5%

(a). We can calculate the contractual interest rate by using following formula:

Contractual interest rate = Annual interest ÷ Face value

= $40 ÷ $1000

= 0.04 or 4.0%

(b). we can calculate the price of bonds by using following formula:

Price of bonds = Annual interest ÷ Market interest rate

= $40 ÷ 5%

= $800.00

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Answer: $38,097.50

Explanation:

Mandy Feng has to pay Johnson $35,000 for the year as well as various taxes. Adding all of these up is the total cost of hiring Johnson to Mandy Feng.

Calculating therefore we have,

= Salary + Social Security Taxes + Medicare Taxes + SUTA Tax + FUTA Tax

Remember, it is stated that FUTA and SUTA are applicable to only the first $7,000 of Johnson's pay.

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Indole is an end product created by the degradation of ________________.
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Based on the information given in the question, the Taktzeit for the ice-cream scoopers will be calculated thus:

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3 years ago
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Answer:

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<u />

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As a result of a decrease in the demand for U.S. dollars, there has been depreciation in the value of the U.S. dollar relative t
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Explanation:

8 0
3 years ago
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