The bond market requires a return of 7.5 percent on the 3-year bonds issued by Beck Co. The 7.5 percent is referred to as the: A
1 answer:
Answer:
The correct answer is letter "D": yield to maturity.
Explanation:
Yield to Maturity or YTM refers to the required market interest rate bonds posses. YTM represents the anticipated return investors could obtain in case they hold the bond until maturity. YTM is expressed as an annual rate and it is calculated using the following formula:
where:
- n = <em>number of years to maturity</em>
- Face Value = <em>maturity value of the bond</em>
- Current Price = <em>price of the bond today</em>
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Answer:
Ans. He must use 2,987.76 pounds of alloy X (Cu=69%) and 2,365.24 pounds of alloy Y (26%=Cu)
Explanation:
Hi, let´s call alloy X the alloy that contains 69% of Cu and alloy Y the one containing 26% of Cu. Since he needs to produce 5,353 pounds of alloy, the first equation that we need to use is the following.
Now, we need this 5,353 pounds of the new alloy to be 50% Cu, therefore, we have to use a portion of alloy X and alloy Y. This is as follows.
And we have already established that X+Y is equal to 5,353, therefore this equation should look like this.
And we solve for X this equation, this as follows.
Now, we use this result and substitute this for X in the first equation like this.
and then, we solve for Y
So, he needs to use 2,365.24 pounds of alloy that contains 26% of Cu, this means that the rest (2,987.76 pounds) must come from the alloy that contains 69% of Cu.
We can check this result by finding the overall Cu obtained by this amounts of alloy, that is
That adds up to 2,676.51 pounds of pure Cu, and since the total weight of the new alloy is 5,353, this amount of copper makes up for:
50% of the total weight.
Best of luck.