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eduard
3 years ago
9

Which of the following bonds has the greatest price risk? A 10-year $100 annuity. A 10-year, $1,000 face value, zero coupon bond

. A 10-year, $1,000 face value, 10% coupon bond with annual interest payments. All 10-year bonds have the same price risk since they have the same maturity. A 10-year, $1,000 face value, 10% coupon bond with semiannual interest payments.
Business
1 answer:
kogti [31]3 years ago
5 0

Answer:

A 10-year, $1,000 face value, zero coupon bond.

Explanation:

Zero coupon bonds are sold at a deep discount, and do not pay coupons, only pay the full par value price at maturity.

Zero coupon bonds are riskier than other types of bonds because they are subject to interest tax risk: this means that even if the bond does not pay coupons, the IRS still computes an imputed interest that the bond would have received, and charges an income tax over it.

If the bondholder of a zero coupon sells the bond before maturity, the risk of having paid more in both income taxes on imputed intersest, plus the initial price of the bond itself, than the gain from the sale, is very high.

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Answer:

The delegation is not effective and valid since the original contract was based on personal skills and it involves personal services.

Katherine's personal expertise is required to write the chapter and Dana does not necessarily possess the same expertise or skills as Katherine does.

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3 years ago
Using policy to stabilize the economy The government has the ability to influence the level of output in the short run using mon
amm1812

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B. Personal income taxes

Explanation:

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Which is an example of something that is inelastic?
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To copy text in a word document to an Excel spreadsheet, you should first format the text as a Word table or as text separated b
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Commas, tabs, semicolon, or spaces.

Explanation:

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