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sashaice [31]
3 years ago
14

Up in Smoke Tobacco Shops' bond carries a 9 percent coupon, pays interest semiannually, and has 10 years to maturity. What is th

e bond's yield to maturity if the bond is selling for $937.75 (rounded to the nearest whole percent)
Business
1 answer:
lara [203]3 years ago
6 0

Answer:

10%

Explanation:

Since the bond is selling at a discount, it means that the coupon rate is blow the market rate, so the actual rate must be higher. Since there is only one option with an interest rate above 9%, we must check to see if it works.

10% yearly interest rate = 5% semiannual interest rate

we must determine the PV of the 20 coupons paid and the face value at maturity.

to calculate the PV of the 20 coupons ($45 each) we can use an excel spreadsheet and the NPV function with a 5% discount rate: PV of the coupons = $560.80

the PV of the face value in 10 years = $1,000 / 1.05²⁰ = $376.89

the present value of the coupons and the bond at maturity = $560.80 + $376.89 = $937.69. The PV using a 5% semiannual rate is very similar to $937.75, and since the question asked us to round up to the nearest whole percent, we can assume it is correct.

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You are planning to save for retirement over the next 30 years. To do this, you will invest $750 per month in a stock account an
Alex

Answer:

The withdrawals will be of  $ 11,379.014 per month

Explanation:

Future value of the annuities:

C \times \frac{1-(1+r)^{-time} }{rate} = PV\\

C         750.00

time 360(30 years x 12 monhs per year)

rate 0.008333333 (10% / 12 months)

750 \times \frac{1-(1+0.00833)^{-360} }{0.008333} = PV\\

PV $1,695,365.9436

C \times \frac{(1+r)^{time} -1}{rate} = PV\\

C         250.00

time 360 (30 years x 12 monhs per year)

rate             0.005 (6% / 12 months)

250 \times \frac{(1+0.005)^{360} -1}{0.005} = PV\\

PV $251,128.7606

Total 1,695,365.84 + 251,128.76 = 1.946.494,6‬

and from here we withdraw for 25 years:

PV \div \frac{1-(1+r)^{-time} }{rate} = C\\

PV 1,946,495

time 300 (25 years x 12 months)

rate 0.004166667 (5% / 12 months)

1946494.6 \div \frac{1-(1+0.004167)^{-300} }{0.004167} = C\\

C  $ 11,379.014

6 0
3 years ago
1. Job Searching in the Digital Age When preparing for employment, you must know yourself, know the job market, and know the emp
bazaltina [42]

Answer:

By asking self reflective questions like–

Would I like to work for someone else, or be my own boss?

Explanation:

By so doing, it allows you to know your strengths and can you make right job choices peculiar to you.

For example, a recent college graduate student John who is very skilled at art may examine himself to know if he prefers to open his own art collection or instead would want to work for an art collection company.

4 0
3 years ago
which of the following is a document whereby a bank promises to pay a payee a certain amount of money at a future time?
Anna71 [15]

A certificate of Deposit is a document whereby a bank promises to pay a payee a certain amount of money at a future time.

A record may be dependent, like tabular documents, lists, paperwork, or clinical chart, semi-dependent like an ebook or a newspaper article, or unstructured like a handwritten word. documents are sometimes classified as a mystery, personal, or public. they'll also be defined as drafts or proofs.

The purpose of a document is to facilitate the switch of records from its author to its readers. it is the author's activity to design the report so that the facts it contains can be interpreted accurately and effectively. To do that, the writer can employ a fixed of stylistic tools.

process documentation is the act of capturing or documenting all of the steps in a particular assignment. preferably, it has to happen in real-time. As employees carry out an assignment, they record every step they take.

To learn more about Document visit here:

brainly.com/question/27396650

#SPJ4

4 0
1 year ago
The Engine Division provides engines for the Tractor Division of a company. The standard unit costs for the Engine Division are:
olga nikolaevna [1]

Answer: $2,400

Explanation:

The best transfer price is the related cost to the division in question and this is usually the Variable cost of production.

Since there is excess capacity, we can assume that no benefits will be lost in transit.

To calculate therefore, we simply add up all the Variable costs of production.

= Direct labor + Direct Material + Variable Overhead.

= 1,300 + 700 + 400

= $2,400

$2,400 is the best transfer price to avoid transfer price problems.

6 0
3 years ago
Hurricane Irene was forecast to hit the Mid-Atlantic/Northeast about a week before it arrived. The plan to evacuate the Outer Ba
iragen [17]

The plan to evacuate the Outer Banks of North Carolina was a(n) action plan.

Explanation:

An action plan is a document that lists what steps need to be taken to achieve a specific objective. An action plan is a series of actions that need to be taken or tasks that need to be performed well, for a successful strategy.

An action plan seeks to explain what resources are needed to accomplish the goal, to formulate a timetable for when certain activities need to be accomplished and to decide what resources are needed.

3 0
3 years ago
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