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Vlad1618 [11]
3 years ago
9

A four-year bond has an 8% coupon rate and a face value of $1000. If the current price of the bond is $878.31, calculate the yie

ld to maturity of the bond (assuming annual interest payments). Group of answer choices
Business
1 answer:
k0ka [10]3 years ago
7 0

Answer:

Yield to maturity =11.75%

Explanation:

The yield to maturity to Maturity van be worked out using the formula below:

YM =( C + F-P/n)  ÷  ( 1/2× (F+P))

C- annual coupon,

F- face value ,

P- current price,

n- number of years to maturity

YM - Yield to maturity

C- 8%× 1000 = 80, P- 878.31, F- 1000

AYM =  80 + (1000-878.31)/4  ÷  1/2×  (1000+878.31)

        = 110.4225    ÷ 939.155

       = 11.75%

Yield to maturity =11.75%

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3 0
1 year ago
The liabilities of Wildhorse Company are $113,000 and the owner’s equity is $235,000. What is the amount of Wildhorse Company’s
kirill [66]

Answer:

$122,000

Explanation:

i dont know i just subtracted ¯\_(ツ)_/¯

8 0
3 years ago
The comparative balance sheet of ConnieJo Company, for December 31, Years 1 and 2 ended December 31 appears below in condensed f
Sophie [7]

Answer:

Kindly check attached picture

Explanation:

Kindly check attached picture for detailed statement using the direct method

8 0
3 years ago
10
Karo-lina-s [1.5K]

Answer:

C. Selling is a larger process that involves many steps that lead to and support this narrower definition of selling.

8 0
3 years ago
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Define the following terms: a. Cost of debt b. Cost of equity c. After-tax WACC d. Equity beta e. Asset beta f. Pure-play compar
gtnhenbr [62]

Answer: The answers are explained below.

Explanation:

• Cost of debt: The cost of debt is the interest rate that a company is charged on its debts. It is the interest paid on bonds, loans etc. The cost of debt is usually the before-tax cost of a debt.

• Cost of equity: The cost of equity is the return a firm pays to its equity investors e.g shareholders in order to reward them for the risk taken by investing their capital. Companies need capital to operate and grow hence, individuals and organizations who provide funds to such companies are rewarded.

• After tax WACC: The Weighted Average Cost of Capital (WACC) is a firm's combined cost of capital including preferred shares, common shares, and debt after the deduction of tax.

• Equity Beta: It measures the sensitivity of the stock price to changes in market. Equity Beta is also called levered beta.

• Asset beta: It is the beta of a firm without the effect of debt. It is a company's volatility of returns without its indebtedness.

• Pure play comparable: The pure play comparable is the taking of the beta estimate of another company that is comparable and in same line of business.

• Certainty equivalent: It is the guaranteed return that an individual would take now, rather than awaiting a higher but uncertain return later in the future.

3 0
3 years ago
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