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mars1129 [50]
3 years ago
14

At the beginning of her current tax year, Angela purchased a zero-coupon corporate bond at original issue for $51,500 with a yie

ld to maturity of 6 percent. Given that she will not actually receive any interest payments until the bond matures in 8 years, how much interest income will she report this year assuming semiannual compounding of interest
Business
1 answer:
wolverine [178]3 years ago
5 0

Answer:

Angela's income interest is $772,500‬

Explanation:

Income interest at 1st Semiannual duration

Semi annual interest = $51,500*6%*(6/12)= $154,500

Income interest at 2nd Semiannual duration

Note New Principal for 2nd year will be =$51,500+$154,500= $206,000

Semi annual interest = ($51,500+$154,500)*6%*(6/12)= $618,000‬

There fore Total income = $154,500+$618,000‬= $772,500‬

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Education is increasingly important for job seekers due primarily to which of the following factors?
Drupady [299]

Answer:

70

Transition to a post- industrial economy

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Median weekly earnings are higher for those with a college education

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De facto segregation

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6 0
3 years ago
Assume you short sell 100 shares of IBM common stock at $125 per share. If the initial margin is 70%, what is the amount that yo
zhuklara [117]

Answer: d) $8750

Explanation:

The Cash buffer is also the margin of the total value of the stock.

= Initial margin * Investment value

= 70% * (125 * 100)

= 70% * 12,500

= $8,750

3 0
3 years ago
When the marginal revenue curve intersects the horizontal axis A. demand is relatively inelastic. B. demand is perfectly elastic
konstantin123 [22]

Answer:

D. demand is unitary elastic.

Explanation:

A unitary elastic demand means that the quantity demanded will change proportionally to any change in the price of the product or service. E.g. price decreases by 10%, then quantity demanded will increase by 10%.

The marginal revenue curve represents the additional revenue generated by selling one more unit. As the marginal revenue curve approaches 0, it means that selling one additional unit generates lower revenues.

8 0
3 years ago
Winston Clinic is evaluating a project that costs $61,500 and has expected net cash inflows of $15,000 per year for eight years.
iragen [17]

Answer:

Payback Period = 4 Years

Net Present value = $15692

Internal Rate of Return = 17.82%

Modified Internal Rate of Return = 14.20%

Explanation:

Payback Period = (Initial Investment / Net Cash inflows)

Payback Period = $61500/15000 = 4 Years

Net Present value using PVIF table value at 11% over the period and discount them given cash flows gives us discounted cash flows.

Year  CF       PVIF 11%,n   Discounted CF

0 -61500  1.000   (61,500)

1 15000  0.901   13,514  

2 15000  0.812   12,174  

3 15000  0.731   10,968  

4 15000  0.659   9,881  

5 15000  0.593   8,902  

6 15000  0.535   8,020  

7 15000  0.482   7,225  

8 15000  0.434   6,509  

Summing up the discounted Cash flows gives us the Net Present value of $15692

Internal Rate of Return:

Using Excel Function IRR @ 17.82% applying it on cash flows gives the rate where Present value of Cash flows is Zero.

Modified Internal Rate of Return:

Modified internal rate of return is at the level of 14.20% as it lower than IRR because it assume positive cash flows invested at cost of capital.  

4 0
3 years ago
In accordance with RESPA, whenever a buyer obtains a new first mortgage loan from a chartered or insured lender, when the loan i
Hoochie [10]

Answer:

A. 3 business days

Explanation:

In accordance with RESPA, whenever a buyer obtains a new first mortgage loan from a chartered or insured lender, when the loan is insured by the FHA or guaranteed by the VA, or when the loan will be sold to one of the federally related secondary mortgage market agencies, a good-faith estimate of the settlement costs must be provided by the lender within 3 business days.

5 0
3 years ago
Read 2 more answers
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