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Masteriza [31]
3 years ago
12

The 4.5 percent bond of JL Motors has a face value of $1,000, a maturity of 7 years, semiannual interest payments, and a yield t

o maturity of 6.23 percent. What is the current market price of the bond
Business
1 answer:
DiKsa [7]3 years ago
5 0

Answer:

<em>The current market price for the bond is $903.05</em>

Explanation:

<em>Steps taken to arrive at the current market price of the bond</em>

<em>Recall PV=present value</em>

<em>face value=$1000</em>

<em>percent bond=4.5,</em>

<em>A semiannual interest payments of 7 years, yielding a maturity rate of=6.23%</em>

<em>PV = [(.045 × $1,000)/ 2] ×{(1 - {1 / [1 + (.0623/ 2)]14}) / (.0623 / 2)} + $1,000 / [1 + .0623 / 2)]14 </em>

<em>PV = $903.05</em>

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Which of the following statements regarding a SEP is true?
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Answer:

All the statements are false

Explanation:

A simplified employee pension (SEP) retirement plan can be set up by an employer or by someone that is self-employed. The employer benefits from the SEP because his contributions are tax deductible. The employer's contributions to SEP individual retirement accounts is completely discretionary, they don't have to follow a fixed rate or amount. The contributions must be equally proportional to all full time employees. The main advantage of a SEP plan is that it is very simple to set up.

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The top management of a cereal manufacturing company wants to change the packaging of their products and appeal to attract a you
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3 years ago
You are considering investing in a security that will pay you $80 in interest at the end of each of the next 10 years. If this s
elena55 [62]

Answer:

the internal rate of return is 6%

Explanation:

The computation of the irr is shown below

Given that

Initial investment = $588.81

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= IRR()

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7 0
3 years ago
In 2013, Natural Selection, a nationwide computer dating service, had $500 million of assets and $200 million of liabilities. Ea
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Answer and Explanation:

The computation is shown below:

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= 0.667

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= 4.285

Times burden covered is

= EBIT ÷  (Interest +Principal repayment ÷ ( 1 -tax rate))

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= 1.764

b)

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Principal, Interest and Common dividend payments -

= [$120 - ($28 + (($24 + 0.3 × 20) ÷ (1 - 0.4))] ÷ 120

= 0.35 or 35%

3 0
3 years ago
Which of the following countries is the world's leading exporter of cacao beans?
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The country that is the world's leading exporter of cacao beans is Cote d'lvoire. Since the 60's, the production of these beans has increased to 3.6 million tonnes. The 2nd highest country that is an exporter of cacao beans is Ghana. The correct answer is A. 
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