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
AveGali [126]
3 years ago
10

A $1,000 six-year bond has an 8 percent coupon, is selling at par, and contracts to make annual payments of interest. The durati

on of this bond is 4.99 years. What will be the new price if interest rates increase to 8.5 percent
Business
1 answer:
Dovator [93]3 years ago
3 0

Answer:

$976.90 will be the new price if interest rates increase to 8.5 percent.

Explanation:

YTM = 8%

Change in interest rate = (8.5% - 8%) = 0.5%  <em>(Increase of 0.5% )</em>

%Change In Price of Bond = -Duration/(1+YTM) X Change in Rate

                                            = -4.99/(1+0.08) X 0.5%

                                            = -2.310%

There will be a decrease of 2.310% in Bond Price

New Bond Price = 1000 - (1000 X 2.310%)

                           = 1000 - 23.10

                           = $976.90

You might be interested in
Pls help
Arturiano [62]

Answer:

True

Explanation:

You should incorporate your life desires into choosing a career choice because if you are not happy with your job or you don't feel fulfilled with what you are doing then you are only harming yourself mentally and sometimes physically by continuing to do something that doesn't fit with your desires.

4 0
3 years ago
Compare and contrast the penalties in a civil and criminal trial.
Vladimir79 [104]

Answer: Compare and contrast the penalties in a civil and criminal trial. In a criminal trial, a defendant can be sentenced to jail time, can be fined, and can be forced to undergo some treatment or remedy. In a civil trial, a defendant can be assessed damages and can be coerced to follow through on an agreement.

Explanation: HOPE IT HELPS :)

6 0
3 years ago
Read 2 more answers
Half of all potential customers would pay $10 for your product but half would only pay $8 but you cannot tell them apart. Your m
IgorLugansk [536]

Answer:

The correct answer is b) $4.

Explanation:

This is simple problem, it requires us to to tell expected profit. We know that profit is equal to revenue minus expense. So in question revenue is given as $ 8 and cost is $ 4. So the profit would be

Profit = Revenue -Cost = 8 - 4 = $ 4

5 0
3 years ago
1. Heather and Joe want the lowest interest rate for their residential mortgage. Which financial institution is designed to offe
gogolik [260]
By definition, a mortgage is loan that is used to purchase a property. The financial institutions can are designed to offer low interest rates on residential mortgages are commercial banks and loan associations. They often lead against the one-to-four family mortgages.
7 0
3 years ago
On December 31, 20X4, Alan and Dave are partners with capital balances of $80,000 and $40,000, and they share profit and losses
lawyer [7]

Answer:

$24,000

Explanation:

For computing the implied goodwill, first, we have to calculate the total partners capital and total firm capital

Total partners capital = $80,000 + $40,000 + $36,000

                                    = $156,000

Now the total firm capital would be

= $36,000 ÷ 20%

= $180,000

Now the implied goodwill would be

= $180,000 - $156,000

= $24,000

3 0
3 years ago
Other questions:
  • An agreement to settle a debt for less than the sum claimed is referred to as?
    9·1 answer
  • Suppose that a company needs 1,500,000 items during a year and that preparation for each production run costs $900. Suppose also
    13·1 answer
  • Carmen Camry operates a consulting firm called Help Today, which began operations on August 1. On August 31, the company’s recor
    6·2 answers
  • Marcy left a large Fortune 500 company to go to a small start-up technology firm. Earlier in her career, Marcy wanted a high sal
    5·1 answer
  • What information will colleges not require on your application?
    6·2 answers
  • What happens if an offeree alters and then signs any part of an offer?
    6·1 answer
  • alicia worked in the customer service department and received a large amount of e-mail. her job required her to open e-mail and
    8·2 answers
  • To prevent the President from engaging in a long-term war without Congressional approval and oversight, Congress passed the ____
    11·1 answer
  • The income statement of Whitlock Company is presented here.
    15·1 answer
  • Pay the first monthly installment of $2,011 related to the $104,000 long-term note payable borrowed in january 1. Round your int
    5·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!