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marusya05 [52]
3 years ago
7

Seaside issues a bond with a stated interest rate of 10%, face value of $50,000, and due in 5 years. Interest payments are made

semi-annually. The market rate for this type of bond is 12%. What is the issue price of the bond (rounded to nearest whole dollar?
Business
1 answer:
mars1129 [50]3 years ago
3 0

Answer:

Total $46,319.9565

Explanation:

We need to calculate the value of the present value of the bond payment

and the maturity using the current market rate

C \times \frac{1-(1+r)^{-time} }{rate} = PV\\

C 2500 (50,000 x 0.10/2)

time 10 (5 years 2 payment per year)

rate 0.06     (12% annual --> divide by 2 to convert semiannual)

2500 \times \frac{1-(1+0.06)^{-10} }{0.06} = PV\\

PV $18,400.2176

\frac{Maturity}{(1 + rate)^{time} } = PV

Maturity 50000

time 10

rate           0.06

\frac{50000}{(1 + 0.03)^{10} } = PV

PV   $27,919.7388

PV bond interest payment  $18,400.2176

PV maturity payment       $27,919.7388

Total $46,319.9565

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Answer:

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Explanation:

Efficiency is a measure of productivity that is used to determine how well a target is achieved, by finding the ratio of the actual output to the expected output. In this example, the number of units is the output of the assembly line, and the assembly line efficiency is calculated as follows:

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actual output = 25 minutes

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required output = 120 units

∴ efficiency = \frac{5}{120} *100

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5 0
3 years ago
Suppose the economy goes from a point on its production possibilities frontier (PPF) to a point below that PPF. Assuming that th
qaws [65]

Answer:

The correct answer is: a new law that interferes with economic efficiency.

Explanation:

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3 years ago
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5 0
4 years ago
According to the Mundell–Fleming model, in an economy with flexible exchange rates, expansionary fiscal policy causes net export
maxonik [38]

Answer: Decrease and Increase

Explanation:

According to the Mundell–Fleming model, in an economy with flexible exchange rates, expansionary fiscal policy will cause the net exports to decrease. Expansionary fiscal policy shifts the IS curve rightwards, as a result BOP surplus created in the economy. So, exchange rate decreases to shift the BOP back to its initial position. As a result of lower exchange rate, exports falls. Hence, net exports decreases.

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5 0
3 years ago
Zwick Company bought 25,000 shares of the voting common stock of Handy Corporation in January 2021. In December, Handy announced
sp2606 [1]

Answer:

$125,000

Explanation:

Zwick company bought 25,000 shares of Handy corporation

In 2021 Handy corporation reported $208,100 net income

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Hence Zwick's dividend revenue from Handy corporation is $125,000

8 0
4 years ago
Read 2 more answers
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