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
lina2011 [118]
3 years ago
5

Mette Badminton Equipment Co. wants to raise $7 million to expand operations. To accomplish this, it plans to issue 20-year bond

s with a face value of $1,000. The coupon rate is set at 9% and the couponds will be paid semi-annually. The bonds are priced at a yield-to-maturity of 10%. What is the minimum number of bonds the firm must sell to raise the $7 million

Business
1 answer:
givi [52]3 years ago
7 0

Answer:

7,657 bonds

Explanation:

In order to determine the minimum number of bonds first we have to find out the present value of the bond which is to be shown in the attached spreadsheet.

Data provided in the question

Future value or Face value = $1,000

PMT = $1,000 × 9% ÷ 2 = $45

Rate of interest = 10% ÷ 2 = 5%

NPER = 20 years × 2 = 40 years

The formula is shown below:

= PV(Rate;NPER;PMT;FV;type)

So, after solving this, the present value of the bond is $914.20

Now the raise amount is $7 million

So, the number of minimum number of bonds is

= $7,000,000 ÷ $914.20

= 7,657 bonds

You might be interested in
You are trying to explain to your friends the importance of using real GDP to measure economic health over time, but some of the
Yuri [45]

Answer: $15,909.09

Explanation:

Nominal GDP is the value of goods and services that is calculated on the basis of current year prices whereas Real GDP is the value of goods and services that is determined on the basis of Base year prices. If we are using the identical price for both the years for calculating GDP then we can see the increment in the current year GDP from the last year. This means that the quantity of goods produced in the current year is larger than the last year. That's why it is important to use Real GDP rather than Nominal GDP.

Given that,

Nominal GDP (millions of dollars) = $14000

Price level (GDP deflator) = 88

\text{GDP dflator}=\frac{Nominal\ GDP}{Real\ GDP}\times100

\text{88}=\frac{14,000}{Real\ GDP}\times100

Real GDP = 159.09 × 100

                = $15,909.09

Hence, Real GDP = $15,909.09.

Therefore, Real GDP is greater than Nominal GDP hence we can say that the amount of good produced is worth more than $14,000.

3 0
3 years ago
The team-centered decision-making model is preferred when: relevant information and expertise is found in a few select individua
Law Incorporation [45]

Answer:

Participation is needed to obtain necessary commitment

Explanation:

Decision Making Process is a process of Evaluation of various alternatives available through several methods like forecasting.

During evaluation, risk, time and the efficiency of these alternatives are checked.

Team-centred decision making style is preferable when;

1. Relevant information and how to go about issues cannot be not properly arranged by one person

2. Participation is needed for commitment

3. Making one individual as the central power hurts the team

4. If an uncommon decision is to be made

8 0
3 years ago
Consider the following items:
Arada [10]

Answer: Long-term assets are assets with a duration of more than one year. From the list the parties classified as long-term assets are three:

- Land

- Buildings

-Equipment

The rest of the games are classified as:

Accounts receivable (short-term assets)

Notes payable (due in three years) (Long-term liabilities)

Accounts payable (Short-term liabilities)

Retained Revenue (Equity)

Prepaid rental (Short-term assets)

Unearned Renvenue (Short-term liabilities)

Notes payable (due in six months) (Short Term Liabilities)

6 0
3 years ago
You are considering purchasing stock in Canyon Echo. You feel the company will increase its dividend at 3.6 percent indefinitely
VMariaS [17]

Answer:

$45.76

Explanation:

Next dividend = Dividend just paid * (1 + Dividend growth rate) = $3.71 * (1 + 0.036) = $3.84356

Using the formula for the dividend discount model, we can calculate he price per share of the company's stock as follows:

Stock price = Next dividend / (Required return - Dividend growth rate) = $3.84356 / (0.12 - 0.036) = $45.76

Therefore, the price per share of the company's stock is $45.76.

3 0
3 years ago
Sharp Company manufactures a product for which the following standards have been set:
topjm [15]

Answer:

See attached file pls

Explanation:

6 0
3 years ago
Other questions:
  • Cindy invests $10000 in an account that pays an annual rate of 3.96%, compounding semi-annually. approximately how much does she
    7·1 answer
  • ) A health insurance will pay for a medical expense subject to a $100 deductible. Assume that the amount of the expense is expon
    11·1 answer
  • Name three factors that can contribute to increased productivity in a country?
    14·1 answer
  • An essential element of being receptive to messages is to have an open mind<br> True or False
    8·2 answers
  • The management team at Imagine Advertising is trying to land a new client. Carla, the CEO, has set targets for how much the cont
    10·1 answer
  • Why would a Roth 401(k) investment plan allow you to invest the most amount of money?
    11·1 answer
  • Something smells peculiar... Oh it IS cheese
    10·2 answers
  • Hello, please help me with this paper, I understand it's long and requires a lot of work, but all the help is appreciated! Thank
    15·1 answer
  • The airlines sold fewer tickets to business travelers during the "Great Recession" due to more companies using video conferencin
    12·1 answer
  • Both interest bearing and noninterest bearing notes bear interest.<br> A. True<br> B. False
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!