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Paraphin [41]
3 years ago
9

has a bond outstanding with a coupon rate of 5.78 percent and semiannual payments. The yield to maturity is 6.5 percent and the

bond matures in 22 years. What is the market price if the bond has a par value of $1,000?

Business
1 answer:
Dominik [7]3 years ago
5 0

Answer:

$916.35

Explanation:

For this question we use the Present value function that is shown on the attachment. Kindly find it below

Provided that,  

Future value = $1,000

Rate of interest = 6.5%  ÷ 2 = 3.25%

NPER = 22 years  × 2 years = 44 years

PMT = $1,000 × 5.78% ÷ 2 = $28.9

The formula is shown below:

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

So, after solving this, the market price of the bond is $916.35

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Consider a portfolio comprised of four risky securities. Assume the economy has three states with varying probabilities of occur
olga nikolaevna [1]

Answer:

B. The portfolio expected rate of return must be the same for each economic state.

Explanation:

Variance formula = sum of (probability x (r - mean)^2)

r= expected return

if the expected return would be same for each economic state then the mean would equal to expected return which ultimately will give variance zero ( as r-mean would be 0).

Hence the correct option is B. The portfolio expected rate of return must be the same for each economic state.

8 0
3 years ago
You are examining an investment opportunity. It would require you to pay money today and then receive payments semi-annually fro
Lady_Fox [76]

Answer:

The semi annual rate is 4.88%

Explanation:

semi annual rate = [((1+r)^(1/n)) -1]

                            =  [((1+10%)^(1/2)) -1]

                            = 4.88%

Therefore, the semi-annual rate (i.e. periodic return per six months) do you require (i.e. need to earn such that this implies 10% earned per year when you get to compound semi-annually) is 4.88%.

 

5 0
3 years ago
Shannon says that she works out in the evenings instead of the afternoons because Roger is always late coming home from work. Ro
IrinaVladis [17]

Answer:

The options are given below:

a) punctuation

b) interpretation

c) perceptuation

d) conjugation

e) intrepidation

The correct option is A. Punctuation.

Explanation:

To punctuate a communication refers to the interpretation of an ongoing sequence of events by determining that one event is the cause and the resulting event is the response. In a situation with communication, if one thing happens, something else always happens.

In the scenario above, both Shannon and Roger are exemplifying the theory of punctuation, because they each think that their actions are as a result of the actions of the other person.

7 0
3 years ago
Determine which of the following bags of chips of comparable quality has the lowest per-unit cost and, thus, is the best buy.A.
Leto [7]

Answer:

B. Brand B, 10 oz. bag for $3.90

Explanation:

The lowest per unit cost of different brands can be calculated using the following formula

Cost per oz=Cost per bag/number of oz in that bag

Brand A Cost per oz=3.60/8=$0.45

Brand B Cost per oz=3.90/10=$0.39

Brand C Cost per oz=6.50/16=$0.406

Brand D Cost per oz=0.59/1=$0.59

So the answer is B. Brand B, 10 oz. bag for $3.90

5 0
3 years ago
If the​ ABC, NBC, and CBS television networks were to create a separate entity called BBB Media to develop and market online ori
ladessa [460]

Answer:

The correct answer to the following question will be "Consolidation".

Explanation:

  • Obligation restructuring is an investment strategy, merging bills into some kind of single debt paid out by a lender via a management plan. Debt consolidation is particularly effective in heavy-interest debt, such as credit card payments.
  • Debt restructuring is a form of financial refinancing that involves taking out a loan to cover off so many others.
  • This is usually referred to as a personal finance mechanism for people working in high mortgage debt, but sometimes it could also refer to a monetary solution of the country to the restructuring of corporate bonds or government borrowing.

Therefore, Consolidation is the right answer.

7 0
3 years ago
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