Answer:
Option D $8333
Explanation:
The value of the irredeemable bond can calculated using the Dividend Valuation Model.
The formula for the computation is:
Value of the Bond = Interest paid / rate of return on a similar bond
Value of the Bond = $500 / 6% = $8333.33
Note that initially the bond was worth $5000 which can be calculated with the same formula:
Value of the Bond = $500 / 10% = $5000
The net increase is $3333
So the correct answer is option D.
Answer:
Shifts right
Explanation:
A rightward shift in the money supply curve indicates its increase. When the FOMC purchases Treasury bills, they purchase these securities with money, thus injecting more money into the economy and increasing the money supply.
I believe the answer is either tall or bureaucratic organization.
Answer:
10.64 years
Explanation:
To find the number of years , use this formula :
FV / PV = (1 + r) ^n
FV = Future value = $1 million
P = Present value = $560,000.
R = interest rate = 5.6%
N = number of years
$1,000,000 / $560,000 = (1.056)^n
1.785714 = (1.056)^n
Find the In of both sides
n = 10.64 years
Answer:
d.All of these choices are correct.
Explanation:
a) when we sale the bonds cash will be debited for the journal entry.
b) the value will be the face value times quoted value
face value of $1,000,000 quoted at 98
example $1,000,000 x 98/100 = $980,000
c) we compare the face value against the proceeds to determinate the gain or loss
