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fredd [130]
3 years ago
6

Grand Canal Incorporated issued 10-year bonds six years ago with an annual coupon rate of 9.625% APR. The bonds have a face valu

e of $1,000.00 each and were issued at par value. Today, investors want a 5.99% return for bonds of similar risk and maturity. What is the current market price of Grand Canal bonds
Business
1 answer:
aleksklad [387]3 years ago
6 0

Answer:

$1,125.98

Explanation:

market price of the bonds = present value of face value + present value of coupons

PV of face value = $1,000 / (1 + 0.0599)⁴ = $792.39

PV of coupons = coupon x {1 - [1/(1 + r)ⁿ]} / r = 96.25 x {1 - [1/(1 + 0.0599)⁴]} / 0.0599 = 96.25 x 3.34659 = $333.59

market value = $792.39 + $333.59 = $1,125.98

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What is the effect on market when suppliers under invest in their businesses​
yanalaym [24]

Answer:

  • Low supply
  • Scarcity
  • Low economic growth

Explanation:

When suppliers under invest in their business, they will end up having the capacity to only produce less than the market requires. Should this happen, supply will be reduced in the market which would lead to relative scarcity all else being equal.

For economic growth to happen, there must be increasing production in an economy so if suppliers are under investing and production is low, there might be low or no economic growth.

8 0
2 years ago
While buying refreshments for an upcoming party, you notice that a six-pack of Americana Beer costs $2 and a six-pack of Bavaria
sattari [20]

Answer:

B. two six-packs of Americana Beer.

Explanation:

A. a six-pack of Americana Beer.

B. two six-packs of Americana Beer.

C. $4 and the six-pack of Americana Beer.

D. $4.

six-pack of Americana Beer = $2

six-pack of Bavarian Beer = $4

1 six-pack of Bavarian Beer = $4

1 six-pack of Americana Beer = $2

2 six-pack of Americana Beer = $4

Therefore,

1 six-pack of Bavarian Beer = 2 six-pack of Americana Beer

You buy the six-pack of Bavarian Beer

The opportunity cost of the Bavarian Beer is two six-packs of Americana Beer.

B. two six-packs of Americana Beer.

Opportunity cost is the cost of satisfying a want at the expense of another. It can also be called real cost or true cost

4 0
2 years ago
On January 1, Gucci Brothers Inc. started the year with a $690,000 balance in Retained Earnings and a $597,000 balance in common
Yuri [45]

Answer:

$1,388,200

Explanation:

The total stock holders equity as at the end of the year shall be determined as follows:

                                 Common stock   Retained Earnings      Total

Balance of Jan 1       $597,000           $690,000                $1,287,000

Net income for year                             $96,000                  $96,000

Dividend paid                                       ($14,800)                  ($14,800)

Common stock         $20,000                                               $20,000

Balance at year end  $617,000           $771,200                  $1,388,200

7 0
3 years ago
Read 2 more answers
Pei's savings account balance is $12,000 today. Pei opened the account exactly 7 years ago with a $10,000 deposit. Pei has made
koban [17]

Answer:

2.64%

Explanation:

A = P(1 + r)^n

A = $12,000

P = $10,000

n = 7 years

12,000 = 10,000(1 + r)^7

(1 + r)^7 = 12,000/10,000 = 1.2

(1 + r)^7 = 1.2

1 + r = (1.2)^1/7

I + r = 1.0264

r = 1.0264 - 1 = 0.0264

r = 0.0264 × 100 = 2.64%

5 0
3 years ago
5 points
swat32

Answer:

R

Explanation:

7 0
3 years ago
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