1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Irina-Kira [14]
4 years ago
9

Find the price of a corporate bond maturing in 5 years that has a 5% coupon (annual payments), a $1,000 face value, and an AA ra

ting. A local newspaper's financial section reports that the yields on 5 year bonds are: AAA = 6%, AA = 7%, and A = 8%.
Business
2 answers:
zepelin [54]4 years ago
6 0

Answer:

$917.99

Explanation:

BP = Sum of discounted annual coupon payment + discounted face value

Coupon = 1000 × 0.05 = $50

The bond is AA reted so we use the 7% yiled

Sum of coupons

50/1.07)^1 +50/(1.07)² + 50/(1.07)³ + 50/ (1.07)^4 + 50/ (1.07)^5

=$205

Discounted face value =1000/ 1.07^5

=$712.98

BP = 205 + 712.99

    =$917.99

Ainat [17]4 years ago
3 0

Answer:

$917.996

Explanation:

First, we calculate price:

Price = 5% * 1000 = $50.

At the fifth year, Price = $1000 + $50 = $1050

The price of the Corporate bond is given as:

50/(1+.07) + 50/(1+.07)² + 50/(1+.07)³ + 50/(1+.07)⁴ + 1050/(1+.07)^5

= 917.9960512810481

=$917.996 ---- Approximated

You might be interested in
Trudy is Jocelyn's friend. Trudy looks after Jocelyn's four-year-old son during the day so Jocelyn can go to work. During the ye
Burka [1]
The answer is $34,990
3 0
4 years ago
Incoterms determine the seller’s and buyer’s respective obligations concerning responsibilities and charges for the transportati
Sergeu [11.5K]

Answer:

True

Explanation:

Hi, the statement is true.

Incoterms (International Commercial Terms) are commercial terms, commonly used in international commercial transactions.

These terms determine the obligations, reponsabilities, costs and risks of  both parts involved in a comercial transaction (  buyer and seller) where goods are delivered.

Incoterms rules are accepted worldwide.

5 0
4 years ago
For incentive pay to motivate employees to contribute to the organization's success, the pay plans must be well designed. Which
olga nikolaevna [1]

Answer:

C. Employees value the rewards or incentives that are being offered

Explanation:

Let's see the different options for answer...

<u>A. Performance measures are to be linked to the individual's goals</u>

No.  Even if the performance measures should be linked to the individual's goals, just the mere existence of such KPI is not sufficient to motivate employees.   There has to be some performance reward attached to it.

<u>B. Employees are given very broad performance goals</u>

No. To get a good performance and motivate employees, they must be given clear goals and objectives.

<u>C. Employees value the rewards or incentives that are being offered</u>

Yes.  Even if you have good performance measurements, with realistic goals, the employees won't be motivated to reach those goals if the reward doesn't worth the effort.

<u>D. Employees are given limited resources to meet their goals</u>

No. They won't be motivated if they don't think they have the means to achieve those goals.

6 0
3 years ago
Which one of the following financial statements is not required by GAAP regarding a voluntary health and welfare organization? S
pishuonlain [190]

Answer:

Statement of Operations. ( last choice)

5 0
3 years ago
Read 2 more answers
On December 30 of the current year, Azrael, Inc., purchased a machine from Abiss Corp. in exchange for a noninterest-bearing not
Brut [27]

Answer:

$94,244

Explanation:

Data provided as per the question below:-

Note payable amount = $20,000

rate of interest = 11%

The computation of the present value of factors are shown below:-

Here we are using the annuity table of present value at 11% for 7 years

Present value of factors = Note payable amount × present value annuity factor

= $20,000 × 4.7122

= $94,244

5 0
3 years ago
Other questions:
  • Jackson has a credit card with a 15% interest rate. His dad has a credit card with a 5% interest rate. If they both charge $1,00
    7·1 answer
  • For what purpose are goods and services produced in a socialist economy?
    10·2 answers
  • Suppose a political candidate criticizes a government pollution permit policy that she says lets corporations buy and sell the r
    13·1 answer
  • Select Yes or No to state whether each data set is likely to be normally distributed.
    8·1 answer
  • On October 1st, a company borrowed $60,000 from Eighth National Bank on a 1-year, 7% note. If the company's fiscal year ends on
    11·1 answer
  • Why should you take pictures of your most valuable possessions? (insurance question)
    8·1 answer
  • The current stock price of International Paper is $69 and the stock does not pay dividends. The instantaneous risk free rate of
    6·1 answer
  • The price of a competitive firm's product is $50 per unit. The firm currently has marginal cost equal to $40. To maximize profit
    7·1 answer
  • What do researchers mean by "secondary data"? A. Data collected specifically for the researcher's own study B. Information from
    6·1 answer
  • The hernandez family budgets $420 a month for food. last month they spent $413, which creates a?
    15·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!