1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
faust18 [17]
3 years ago
9

A 3-year annual coupon bond has coupons of $12 per year starting one year from now and matures in 3 years for the amount $100. T

he yield to maturity is 11.8% (annual effective). Find the Macaulay duration of the bond.
Business
1 answer:
Ganezh [65]3 years ago
4 0

Answer: Macaulay Duration = 2.6908154485 = 2.69

Explanation:

Macaulay Duration = Sum of Cash flows Present Value/ current bond price

Cash flows: year 1 = $12

Cash flows: year 2 = 12

Cash flows: year 3 = 100 + 12 = 112

Sum of Cash Flow PV = (1×12÷ (1.118)^1) + (2×12÷ (1.118)^2) +(3×112÷(1.118)^3)

Sum of Cash Flow PV = 270.37857712

Current Bond Price or Value = Face Value/ (1+r)^n + PV of Annuity

Current Bond Price or Value = 1000/ (1.118)^3 + (30×(1 - (1+0.118)^-3)/0.118

Current Bond Price or Value  = 100.48202201

Macaulay Duration = 270.37857712 ÷ 100.48202201

Macaulay Duration = 2.6908154485 = 2.69

You might be interested in
Anheuser-Busch/InBev Company, Inc., has been given the exclusive right to the name Budweiser and is legally protected from other
vichka [17]

Answer:

trademark

Explanation:

A trademark is a property which is intellectually a sign or a design which helps in the recognition of the product. The design or sign which particularly defines and helps in the identification of a product is said to be a trademark of a product. A trademark can be found on the location of the packaging, label or the product. Legally, it is recognized as intellectual property.

3 0
3 years ago
Signal mistakenly produced 1,075 defective cell phones. The phones cost $70 each to produce. A salvage company will buy the defe
kow [346]

Answer: Rework the phones

Explanation:

The phones have already been produced so the cost price of $70 does not matter as it is a sunk cost.

The decision the company makes between scrap and reworking will depend on which option bring in more money.

Scrap = $39

Reworking:

= Price after reworking - Cost to rework

= 146 - 82

= $64

Incremental income of reworking over scrap:

= 1,075 * (64 - 39)

= $‭26,875‬

<em>Signal makes an incremental income of $‭26,875‬ if they rework the phones so they should do that. </em>

5 0
2 years ago
Ben makes an appointment for a $50 haircut, buys a bike for $250, and agrees to work for Coding Associates for one year for $5,0
galina1969 [7]

Answer:

The correct answer is d. ​none of the choices.

Explanation:

A contract is an agreement, usually written, although it can also be spoken, by which two or more parties mutually commit themselves to respecting and fulfilling a series of conditions. It is a type of legal act involving two or more people and is intended to create rights and generate obligations, therefore transmitting rights and obligations to the parties that sign it.

It is governed by the principle of autonomy of the will, according to which, it can be hired on any subject not prohibited. The contracts are perfected by mere consent and the obligations arising from the contract have the force of law between the contracting parties.

Currently the contract is an economic instrument to negotiate, to meet needs. Contracts are used to agree on services, products, locations, among others.

4 0
3 years ago
The term _____________ describes circumstances where a country's exports exceed its imports.
irina1246 [14]

Answer:

C. trade surplus

Explanation:

<em>A trade surplus is a positive balance of tradewhere a country's exports exceed its imports</em>.   Trade Balance = Total Value of Exports - Total Value of Imports if Total Value of Exports is bigger than the Total Value of Imports the trade balance will be positive.

I hope you find this information useful and interesting! Good luck!

4 0
2 years ago
Consider the market for portable air conditioners in equilibrium. a summer of unseasonably cool weather would cause:______
Julli [10]

Consider the market for portable air conditioners in equilibrium. A summer of unseasonably cool weather would cause both the equilibrium price and quantity to decrease. A market-clearing price, often referred to as an equilibrium price, is the consumer cost associated with a good or service when supply and demand are equal or nearly equal.

The manufacturer or vendor is free to transfer as many units as they like, and the consumer is free to access as many units as they like. By setting the supply function to equal the demand function, Qs = Qd, you may determine the equilibrium price.

To learn more about equilibrium, click here

brainly.com/question/14480835

#SPJ4

4 0
2 years ago
Other questions:
  • An arbiter is consulted when
    12·1 answer
  • The Aluminum Company of America (Alcoa) formerly controlled all U.S. sources of bauxite, a key component in the production of al
    11·1 answer
  • A seller (or provider) of goods or services to a business organization, usually a manufacturer or wholesaler, is known as a:
    12·1 answer
  • Sandusky Company borrowed $28,000 from the Lakeside Bank by issuing a 10% three-year installment note. Sandusky agreed to repay
    9·1 answer
  • A buyer purchased a new residence for $175,000. The buyer made a down payment of $15,000 and obtained a $160,000 mortgage loan.
    11·1 answer
  • Presented here are long-term liability items for Skysong, Inc. on December 31, 2017.
    13·1 answer
  • A company orders office supplies in June. Those supplies are received and used in July. The supplies are paid for in August. In
    11·1 answer
  • The Chief Financial Officer of Five Star Food Distributors has asked you to evaluate the building of a new warehouse. As an astu
    8·1 answer
  • Kristoff Walker operates his own catering service. Summary financial data for February are presented in equation form as follows
    7·2 answers
  • How are maquiladoras similar to sweatshops? I. Workers are paid very low wages in both systems. II. Both are prevalent in underd
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!