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shutvik [7]
4 years ago
6

Andrew Industries is contemplating issuing a 30​-year bond with a coupon rate of 7.00 % ​(annual coupon​ payments) and a face va

lue of $ 1 comma 000. Andrew believes it can get a rating of A from Standard​ & Poor's.​ However, due to recent financial difficulties at the​ company, Standard​ & Poor's is warning that it may downgrade Andrew​ Industries' bonds to BBB. Yields on​ A-rated, long-term bonds are currently 6.50 %​, and yields on​ BBB-rated bonds are 6.90 %.A. What is the price of the bond if Andrew Industries maintains the A rating for the bond​ issue?
B. What will be the price of the bond if it is​ downgraded?
Business
1 answer:
erik [133]4 years ago
8 0
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3 years ago
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7 0
3 years ago
Oscar owns a building that is destroyed in a hurricane. His adjusted basis in the building before the hurricane is $130,000. His
damaskus [11]

Answer:

That is $2,000 loss

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8 0
3 years ago
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Answer:

Option b.

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5 0
3 years ago
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