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Zigmanuir [339]
4 years ago
10

You are considering buying a 10-year, $1,000 par value bond issued by IBM. The coupon rate is 8% annually, with interest being p

aid semiannually. If you expect to earn a 10% rate of return on this bond, what is the maximum price you should be willing to pay for this IBM bond?
Business
1 answer:
ehidna [41]4 years ago
4 0

Answer:

The maximum price we should be willing to pay for this IBM bond is $ 877.

Explanation:

The price of bond can be determine by discounting all future cashlows we will get from bond in form of interest payment or redemption amount using expected rate of return.

The detail calculation is given below.

Price = 1000 * Discount factor + annuity factor * 80

Price = 1000 * 0.386 + 80 * 6.145     = 878

Discount factor = (1+10%)^-10 = 0.386

Annuity factor = (1 - (1+10%)^-10)/10% = 6.145

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A broker-dealer is physically located and registered in State A. The broker-dealer has an existing client in State A who is a st
mars1129 [50]

Answer:

D) The broker-dealer must be registered in State B in order to contact the client while she is in medical school in State B

Explanation:

Since the client will live in state B for an extended period of time, at least 4 years if she completes medical school, the broker-dealer must be registered in state B if he wishes to continue doing business with her.

If the client would have only gone to state B for a few months, then the broker could have still worked with her without registering in state B since the client could be considered on a vacation trip.

7 0
4 years ago
How might you balance personal values with the desire to make a profit?
Natali [406]

Answer:

Every investor who ventures into the world of stock investments and finance does so with the clear objective of obtaining an economic gain: it is his clear purpose, and there is no other reason to take the risk than to obtain a benefit greater than the risk assumed. .

Now, each investor is a completely different individual from the others, and in that tenor, each of them has personal values that may be completely different from each other. Thus, each investor must balance her economic interests with her personal values: for example, a conservative and religious investor must analyze in her private heart if she wishes to invest in a company that finances research on abortion.

In this context, in my case my personal convictions do not influence my work, that is, investing is part of my work activity and therefore, my opinions are put aside when considering the investment that can provide the most profits.

4 0
3 years ago
AnyCo is a US consumer product company enjoying broad distribution and dominant market share in its domestic market. An opportun
brilliants [131]

Answer:

AnyCo's BOD should opt for Over the internet distribution mode.

Explanation:

As per the attached sheet, please see that considering the different cost of various alternatives, over the internet distribution mode seems to be the most lucrative one.

Download xlsx
8 0
4 years ago
If the cpi increases from 250 to 275 for one year, the rate of inflation for that year is
hjlf
<span> the rate of inflation for that year is 10%

To calculate the rate of inflation for that year, we need to use this formula:

Rate of inflation =  (CPI2 - CP1) /  CPI1

Rate of inflation = (275 - 250) / 250

Rate of inflation = 25 / 250

Rate of inflation = 1 / 10

Rate of inflation = 10 %</span>
7 0
4 years ago
Countercyclical monetary policy means that _________________. Select the correct answer below: the Fed lowers interest rates dur
vlabodo [156]

Answer:

the Fed lowers interest rates during recessions and raises them during economic booms

Explanation:

Countercyclical monetary policy is a monetary policy used to work against any cyclical tendencies in order to slow down the economy when it is booming, and to stimulate economic activity then there is a recession.

Example of such policy is therefore a reduction of interest by the Fed during recessions and an increase of interest rate when there are economic booms.

5 0
3 years ago
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