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stiks02 [169]
3 years ago
13

A bond will sell at a premium (above par value) ifA) the market value of the bond is greater than the discount rate of the bond.

B) investor's current required rate of return is below the coupon rate of the bond.C) current market interest rates are moving in the same direction as bond values.D) the economy is in a recession.
Business
1 answer:
Anna11 [10]3 years ago
3 0

Answer:

B) investor's current required rate of return is below the coupon rate of the bond.

Explanation:

A bond that is sold at a price above its face value is said to be sold at a premium. A bond sells at a premium when its coupon rate is above the market's required rate of return.

When a bond is sold at a premium, it yields an interest rate which is lower than its coupon rate. For example, a bond's face value is $100 and its coupon rate is 8%. If the bond sells at a premium for $110, it will still pay the same coupon, but it will yield a 7.3% interest rate.

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A. Personal help and interaction wider.

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Due to the physical contact and getting to physically recognise each other, the familiarity increase the level of personal relationship.

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3 years ago
Goods sold On cash Rs 5000 make journal entries<br>​
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Answer:

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Explanation:

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3 years ago
Elinore is asked to invest $ 4 comma 900 in a​ friend's business with the promise that the friend will repay $ 5 comma 390 in on
Mandarinka [93]

Answer:

0.09 or 9%

Explanation:

This question has some irregularities. The correct question should be :

Elinore is asked to invest $4,900 in a​ friend's business with the promise that the friend will repay $5,390 in one​ year's time. Elinore finds her best alternative to this​ investment, with similar​ risk, is one that will pay her $ 5,341 in one​ year's time. U.S. securities of similar term offer a rate of return of 7​%. What is the opportunity cost of capital in this​ case?

Solution

Given from the question

Investment (I) = $4,900

Return on investment (ROI) in one year = $5,341

Rate or opportunity cost of capital r is given by

ROI = I × (1 + r)

input the given data

$5,341 = $4,900 (1 + r)

$5,341 = $4,900 + $4,900r

$5,341 - $4,900 = $4,900r

r = ($5,341 - $4,900) / $4,900

r = 0.09

Or 9% in percentage

6 0
3 years ago
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mr Goodwill [35]
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4 0
3 years ago
Read 2 more answers
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