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ycow [4]
3 years ago
15

The required rate of return on a certain bond changes from 12 percent to 8 percent, causing the price of the bond to change from

$900 to $1,100. Determine the bond's price elasticity.
Business
1 answer:
Olenka [21]3 years ago
5 0

Answer:

the bond's price elasticity = - 0.67

Explanation:

present bond value = $1100

previous bond value = $900

change in bond value = $1100 - $900 = $200

present bond percentage = 8%

previous bond percentage = 12%

% change in bond value = 8% - 12% = - 4%

Bond price elasticity = \frac{change  in bond value}{previous bond value}/\frac{change in percentage}{previous percentage}

                                  = \frac{200}{900} / \frac{-4}{12}

                                  = \frac{2}{9} * -3

                                  = - 0.67

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Lohn Corporation is expected to pay the following dividends over the next four years: $18, $14, $13, and $7.50. Afterward, the c
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Answer:

current share price = $85.96

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4 0
3 years ago
A paint manufacturing company produces three paint bases of differing quality. Due to throughput limitations (measured in gallon
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c. The contribution margin per gallon of throughput for each product

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