Answer:
The price of the bond will be $879
Explanation:
Price of the bond is the present value of all cash flows of the bond. Price of the bond is calculated by following formula:
According to given data
Coupon payment = C = $1,000 x 6.2 = $62 annually = $31 semiannually
Number of periods = n = 2 x 8 years = 16 periods
Current Yield = r = 8.3% / 2 = 4.15% semiannually
Price of the Bond = $31 x [ ( 1 - ( 1 + 4.15% )^-16 ) / 4.15% ] + [ $1,000 / ( 1 + 4.15% )^16 ]
Price of the Bond = $31 x [ ( 1 - ( 1 + 0.0415)^-16 ) / 0.0415 ] + [ $1,000 / ( 1 + 0.0415 )^16 ]
Price of the Bond = $31 x [ ( 1 - ( 1.0415)^-16 ) / 0.0415 ] + [ $1,000 / ( 1.0415 )^16 ]
Price of the Bond = $521.74 + $357.26 = $879
Increase price value profit becomes higher than price, what happens to a company
Answer:
$10,000
Explanation:
Probability that Bikul wrecks the car is 0.10
loss of wrecking the car is $100000
Therefore risk of wrecking the car = Probability x loss
risk = 0.10 x 100000 = 10,000
premium can be equated with risk, hence premium = $10000
Answer:
Sole proprietorship
Explanation:
Sole proprietorship, general partnership or limited partnership
It would most likely violate assumption of normality
Under assumption of normality, we will assume that all variables that relevant to our observation are distributed normally.
Skewed distribution happens when there is an imbalance/anomaly in the distribution, so it will violate the assumption.
