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const2013 [10]
3 years ago
9

Imagine that a local water company issued $10,000 ten-year bond at an interest rate of 6%. You are thinking about buying this bo

nd one year before the end of the ten years, but interest rates are now 9%.
Given the change in interest rates, would you expect to pay more or less than $10,000 for the bond?
Calculate what you would actually be willing to pay for this bond.
Business
1 answer:
mylen [45]3 years ago
6 0

Answer:

Explanation:

The $10,000 is the face value of the bond. Using a financial calculator, input the following to calculate the price at a year before maturity; i.e. at year 9;

Time to maturity; N = 10 - 9 = 1

Annual interest rate; I/Y = 9%

Annual coupon payment; PMT = 0

Face value of the bond; FV = 10,000

then compute present value ; CPT PV = $9,174.31

Therefore, you will pay less than $10,000 for the bond and the price would be  as above $9,174.31

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Luba_88 [7]

Answer:

C) Recurrent Disability provision

Explanation:

The human body is a fantastic machine but sometimes when you have health problems they don't show up immediately.

For example you might get hit on the right side of your head severely and lose partial hearing from your right ear, but in a couple months you might notice that your short term memory has also been affected. Both disabilities were caused by the injury although one showed up before the other.

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Jeff is a member of Go Big Red, LLC. Jeff decides he does not like the color red, preferring instead the colors black and gold.
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Answer:

Option "D" is correct.

Explanation:

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Some individuals argue that accountants should focus on producing financial statements and leave the design and production of ma
dusya [7]

Answer:

If the accountants of an organization are to concentrate only on financial information then there will be no advantage. The both party (organization and the accountant) might suffer if this happened.

Moreover, it would be very costly to have two systems rather than one that captures and processes operational facts at the same time as it captures and reports financial facts.

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Explanation:

3 0
3 years ago
Match the task with professionals who would complete them
kozerog [31]
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dybincka [34]

Answer: d. A price near $60

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The Preferred Stock was selling at $56 then a notice was circulated that RMO would be calling the stock at a price of $60.

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