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
Gnom [1K]
3 years ago
15

Wyatt Oil is contemplating issuing a 20-year bond with semiannual coupons, a coupon rate of 7%, and a face value of $1000. Wyatt

Oil believes it can get a BBB rating from Standard and Poor's for this bond issue. If Wyatt Oil is successful in getting a BBB rating, then the issue price for these bonds would be closest to: $800 $891 $901 $1,000 $1,107
Business
1 answer:
enyata [817]3 years ago
5 0

Complete question:

Security Term (years) Yield (%)

Treasury 2 0 5.5%

AAA Corporate 2 0 7.0%

BBB Corporate 20 8.0%

B Corporate 2 0 9.6%

Wyatt Oil is contemplating issuing a 20-year bond with semiannual coupons, a coupon rate of  7%, and a face value of $1000. Wyatt Oil believes it can get a BBB rating from Standard and  Poor's for this bond issue. If Wyatt Oil is successful in getting a BBB rating, then the issue price  for these bonds would be closest to:

A) $891 B) $901 C) $1,000 D) $800

Answer:

If Wyatt Oil is successful in getting a BBB rating, then the issue price  for these bonds would be closest to:  $901

Solution:

Given,

FV = 1000,

N = 40,

I = 4,

PMT = 35

Compute PV ,

PV = FV \frac{1}{( 1+r)^{n} }

PV = 901.04

If Wyatt Oil is successful in getting a BBB rating, then the issue price for these bonds would be closest to: $901

You might be interested in
It is pizza night at the murphy home and everyone has an opinion about what they should get as a topping on the pizza. which cho
pishuonlain [190]

This isn't really a business question, but generally vegetables would be a healthier choice for a pizza topping instead of meats and cheeses.

7 0
3 years ago
Read 2 more answers
Maurio inc., a publishing house, wants to invest in digital publishing. however, the company does not possess enough capital to
icang [17]

Answer:

A) Factoring

Explanation:

Factoring: This is a short term financial option which refers to financial transactions between a business firm and a financial institution. It is the selling of debt by a business firm at a discounted price to a financial institution.

Maurio inc. is involved in factoring by selling its accounts of credits to restube which is i financing firm at a discount in order to have enough capital to invest in digital publishing.

Factoring is the relationship between the financial institution and the business firm in which the fimancial institution purchases the business firms credit and pay about 80% to 90% immediately and pay the balance at a later date.

There are different types of factoring;

1) Domestic and export factoring

2) Recourse and non-recourse factoring

3) Advance and maturity factoring

4) Disclosed and undisclosed factoring

5 0
3 years ago
Read 2 more answers
For what kinds of needs do you think a firm would issue securities in the money market versus the capital market? A firm would i
USPshnik [31]

Answer:

Answers are A , B and C

Explanation:

A : Transactions in short term debt instruments which are ranged less than twelve months (for example,commercial paper,treasury bills, govt bonds etc.,) and also marketable securities ( only specific marketable securities which are highly liquid and due within 3 months) takers place in the money market.

B : In order to raise finance in the capital markets, issuers typically require a high Equity securities represent an ownership claim to the assets of a company. A preferred share is a special type of security which has a fixed periodic and hence Capital markets are typically used for fixed assets, which company will use over several years.

C : Money Markets are short term markets, where funds are invested for a shorter time - usually one year or less.

8 0
4 years ago
We observe a 20 percent increase in units purchased and an 8 percent decrease in price. The price elasticity of demand in terms
harina [27]

Answer:

the correct answer

a) 2.5

8 0
4 years ago
A company reports the following information as of December 31st:
stepan [7]

Answer:

The company will report $115,000

Explanation:

Giving the following information:

Sales revenue= 350,000

Cost of goods sold= (150,000)

Gross profit= 200,000

Operating expenses= (110,000)

Net operating income= 90,000

Foreign currency translation gain= 25,000

Net income= 115,000

The company will report $115,000

6 0
3 years ago
Other questions:
  • g Handal Corporation uses activity-based costing to compute product margins. Overhead costs have already been allocated to the c
    8·1 answer
  • Which of the following statements is CORRECT? a. If General Electric were to issue new stock this year it would be considered a
    6·1 answer
  • According to Forbes, how much did the naming rights for the 122 teams in the four major U.S. professional sports leagues earn fo
    14·1 answer
  • If the money supply is growing at a rate of 3 percent per​ year, real GDP​ (real output) is growing at a rate of 3 percent per​
    10·1 answer
  • Those buying decisions that involve a narrow set of choice alternatives, encompass a moderate amount of both information search
    12·1 answer
  • Who promoted the theory that success and failure in business should be governed by natural law without interference?
    13·1 answer
  • _is an amount of money placed into a savings or<br> checking account.
    8·1 answer
  • a. Simulation can be used to analyze large and complex real-world situations that cannot be solved by using conventional quantit
    14·1 answer
  • expansionary fiscal policy involves part 2 a. increasing taxes or decreasing government purchases. b. increasing government purc
    9·1 answer
  • Firms can support their employees who have caregiving responsibilities for children and elders through which actions? (check all
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!