Which life insurance settlement option guarantees payments for the lifetime of the recipient, but also specifies a guaranteed pe
1 answer:
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Answer:
total rate of return on the Bond = 9.40%
Explanation:
given data
coupon bonds = 5.8%
bonds price = $1,030
maturity time = 14 year
required return on the bonds = 5.1 percent
solution
we know here market price of the bond is Present Value of Coupon Payments + Present face Value
so that face Valueof bond = $1,000
and here annual Coupon Amount will be
annual coupon amount = $1000 × 5.80%
annual coupon amount = $58
and here Market Price of the Bond will be
Market Price of Bond = Present Value of Coupon Payments + Present face Value ......................1
here Present Value of Coupon Payments at PVIFA 5.10% and 14 Years
Present Value Annuity Inflow Factor (PVIFA) = ....2
Present Value Annuity Inflow Factor =
Present Value Annuity Inflow Factor = 9.83566
and
Present Value Inflow Factor (PVIF) 5.10%, 14 Years= ...........3
Present Value Inflow Factor (PVIF) =
Present Value Inflow Factor = 0.49838
so
Market Price of Bond = ( $58 × 9.83566 ) + ( $1,000 × 0.49838 )
Market Price of Bond = $1,068.85
so total rate of return on the Bond will be
total rate of return on the Bond = [ { Annual Coupon Amount + ( Change in Bond Price ) } ÷ Current Price] ...............4
total rate of return on the Bond =
total rate of return on the Bond = 9.40%
Answer:
The gross margin for December is: 0.5%.
The Gross margin of an organisation or business measure the extent by which its income exceeds the costs it incurs in producing its goods and or services.
The gross margin is measured in percentages. The higher the percentage of this margin, the higher the effectiveness of the company's management in deriving value from every dollar invested.
Explanation:
To arrive at Gross Margin, one is required to subtract the total cost of goods sold from total revenue for the period and dividing that number by revenue. That is:
Gross Margin (GM) =
Step I - Calculate Revenue
This is given as the total amount of goods sold which is:
800 x $500 = $400,000
Step II - Calculate Cost of Goods Sold
Cost of goods sold per unit is given as
$250 per unit.
Total Cost of Goods sold therefore is
800 x $250 = $200,000
Step III - Calculate Gross Margin
=
=
= or 0.5%
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