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
katrin [286]
3 years ago
9

Calculate the value of a bond that matures in 16 years and has a $ 1 comma 000 par value. The annual coupon interest rate is 13

percent and the​ market's required yield to maturity on a​ comparable-risk bond is 12 percent. The value of the bond is ​$ nothing. ​ (Round to the nearest​ cent.)

Business
1 answer:
spayn [35]3 years ago
7 0

Answer:

$1,069.74

Explanation:

We use the present value formula which is shown in the attachment below:

Data provided in the question

Future value = $1,000

Rate of interest = 12%

NPER = 16 years

PMT = $1,000 × 13% = $130

The formula is shown below:

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

So, after solving this, the value of the bond is $1,069.74

You might be interested in
Steve Jobs has achieved a great deal of success. What are some possible negative consequences of the level of power that he hold
Alex73 [517]
People can claim his work or inventions as their own.
6 0
3 years ago
Assume that you are a new analyst hired to evaluate the capital budgeting projects of the company which is considering investing
Alchen [17]

Answer:

Assume that you are a new analyst hired to evaluate the capital budgeting projects of the company which is considering investing in two CPEC projects, “Expansion Zone North” and “Expansion Zone East”. The initial cost of each project is Rs. 10,000. Company discount all projects based on WACC. Further, all the projects are equally risky projects and the company uses only debt and common equity for financing these projects. It can borrow unlimited amounts at an interest rate of rd 10% as long as it finances at its target capital structure, which calls for 50% debt and 50% common equity. The dividend for next period is $2.0, its expected that they will grow at the constant growth rate of 8%, and the company’s common stock sells for $20. The tax rate is 50%.

6 0
3 years ago
Read 2 more answers
Hometown Appliance has been having issues with salesmen who are giving customers incorrect pricing or information or creating ad
AVprozaik [17]

Answer:

start at the top of the command structure

Explanation:

Based on the scenario being described it can be said that the best solution to this would most likely be to start at the top of the command structure. This would allow you to go down the chain of command in order to find and stop the communication problem at the source. Which in doing so you will fix the problem completely, since the rest of the employees will begin to receive the correct information regarding the products.

7 0
3 years ago
can frictional unemployment by itself explain the fact that the late 2010s saw more job openings than unemployed workers
neonofarm [45]

Answer:

Frictional unemployment cannot by itself explain the fact that the late 2010s saw more job openings than unemployed workers.

Instead, frictional unemployment points to the fact that some people are unemployed because they are just entering the labor market for the first time after a long period of absence.

Explanation:

As a part of natural unemployment, frictional unemployment arises when workers search for new jobs or transition from one job to another.  During economic recession, there is no increase in frictional unemployment.  Typical examples of frictional unemployment are caused by graduating students who join the labor force and are unemployed until they find work and parents who rejoin the workforce after taking sometime to stay at home and raise their children.

4 0
3 years ago
A new corporate bond is being offered for $930. The bond has a face value of $1,000 and matures in 10 years. The coupon rate is
PilotLPTM [1.2K]

Answer:

The answer is 7.65%

Explanation:

The cost of capital is equal to the cost of debt in this example as it involves a debt instrument. The formula for the cost of debt is as follows:

(Interest Expense x (1 – Tax Rate) ÷  (Amount of Debt – Debt Acquisition Fees + Premium on Debt – Discount on Debt)

In the example, the given values are the following:

Interest Expense = 7% x $1,000 = $70 (no tax rate was provided)

Amount of debt = $1,000 (face value of the bond)

Debt acquisition fee = $15

Discount on debt = $70 ($1,000 face value vs. the $930 proceeds of the bond, the bond was issued at a discount)

Solution:

$70 ÷ ($1,000 - $15 - $70) = 7.65% cost of capital (cost of debt)

8 0
3 years ago
Other questions:
  • There are many type of negotiating approaches unions use. An example of one is when a union negotiates with a manufacturing comp
    15·1 answer
  • Who is responsible for participating in the discussion at a performance review?
    7·2 answers
  • DAR Corporation is comparing two different capital structures, an all-equity plan (Plan I) and a levered plan (Plan II). Under P
    9·1 answer
  • Payback period is the amount of time it will take to recoup, in the form of net cash inflows, the total dollars invested in a pr
    14·1 answer
  • Which of the following represents a reason for globalizing operations? Select one:
    12·1 answer
  • Vernon Corporation offered detachable 5-year warrants to buy one share of common stock (par value $5) at $20. The price paid for
    10·1 answer
  • Television channel operating profits vary from as high as 45 to 55 percent at MTV and Nickelodeon down to 12 to 18 percent at NB
    15·1 answer
  • Five firms exist in the Liagiba industry. Their respective market shares are 35, 25, 15, 15, and 10 percent. Five firms exist in
    13·1 answer
  • A study by Great Places to Work, a research and consulting firm, highlights the benefits of breaking down boundaries to get all
    6·1 answer
  • On January 1 of this year, Thomas Insurance Corporation issued bonds with a face value of $ 4,000,000 and a coupon rate of 9 per
    12·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!