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RoseWind [281]
3 years ago
5

You purchase a $500 bond that pays 2% coupon yield ($10), and the bond is currently trading for $400. What is the current yield?

Business
1 answer:
Thepotemich [5.8K]3 years ago
6 0

Answer :

2.5%

Step by Step Explanation:

Face value = $500

Coupon yield = 2%

Income earned on he bond each year is at the rate of 2%.

Annual coupon = $10

Current bond price = $400

Formula for current yield = \frac{Annual coupon amount}{Current bond price}

                                        = \frac{10}{400} ×100

                                        =  2.5%

Hence, the current yield is 2.5%

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An example of consumer spending when calculating the GDP using the expenditures approach is _____.
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purchase of weapons for the military

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2 years ago
Item 1 Manufacturing overhead was estimated to be $629,300 for the year along with 20,300 direct labor hours. Actual manufacturi
Neporo4naja [7]

Answer:

$31 per hour

Explanation:

The predetermined overhead rate is computed as

= Estimated manufacturing overhead / Estimated direct labor hours

Given that

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Therefore,

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2 years ago
ssume the following: Gross salary = $120,000 Employee contributions to 401-K = $12,000 Employer match to 401-K = $5,000 Flexible
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Answer:

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Explanation:

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6 0
3 years ago
Ceteris paribus, for the owner of a sawmill, lumber and the sawdust that go into particle board are
Katyanochek1 [597]
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6 0
3 years ago
The market risk premium is computed by: adding the risk-free rate of return to the inflation rate. adding the risk-free rate of
OverLord2011 [107]

Answer:

subtracting the risk-free rate of return from the market rate of return

Explanation:

Market risk premium is the premium over the risk free rate that investors demand for holding a risky asset

Market risk premium = market rate of return - risk free rate

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Market premium in A = 10% - 5% = 5%

Market premium in b = 20% - 5% = 15%

3 0
3 years ago
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