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ioda
3 years ago
9

Due to a number of lawsuits related to toxic wastes, a major chemical manufacturer has recently experienced a market reevaluatio

n. The firm has a bond issue outstanding with 15 years to maturity and a coupon rate of 8 percent, with interest being paid semiannually. The face value of the bond is $1,000. The required simple rate of return on this debt has now risen to 16 percent. What is the current value of this bond?
Business
1 answer:
Veronika [31]3 years ago
4 0

Answer:

The bonds now is being traded at $758.63

Explanation:

We have to discount the coupon payment and maturity at he market rate:

<em><u>Present value of the coupon payment</u></em>

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

Coupon payment $1,000 x 8%/2 = 40.00

time 15 years x 2 =  30

rate 0.08

40 \times \frac{1-(1+0.08)^{-30} }{0.08} = PV\\

PV $450.3113

<u><em>Present value of the maturity:</em></u>

\frac{Maturity}{(1 + rate)^{time} } = PV  

Maturity  $1,000

time  30

rate  0.04

\frac{1000}{(1 + 0.04)^{30} } = PV  

PV   308.3187

PV c $450.3113

PV m  $308.3187

Total $758.6300

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Answer:

Early adopters

Explanation:

Early adopters define to adopt a new product or technology introduced in the market place for the first customers or the new customers

Here the product or technology is the first time introduced in the market with a lot of expectations which could be in terms of sales, revenues, trust, satisfaction, etc

Therefore in the given situation, the early adopters should be chosen for the new developments in the products category

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3 years ago
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Answer:

Customer relationship management system​ (CRM)

Explanation:

A <em>CRM </em>system is what keeps the customer coming back. Instead of targeting each customer with a default bundle of products that are trending, the customer relationship management system tracks down the customer's habits and preferences, creating a tailor-made approach. Every customer is different in things he/she wants to buy. This way, marketing gets more customized and customer statistics generates better reports (more insight for the long-term).

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3 years ago
Classical economist David Hume observed that as the money supply expanded after gold discoveries it took some time for prices to
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Answer:

a. the prices should have risen, but production should not have changed.

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5 0
3 years ago
"A borrower obtained a $10,000 term loan with 6 1/2% interest paid yearly. A $1,000 principal reduction was to be paid with each
aleksley [76]

Answer:

$1585

Explanation:

Interest for the first year = 6.5% of principal due at the beginning of the year

= 6.5% of $10,000

= $ 650

Principal repayment at the end of the year = $1000

Principal due at the beginning of the second year = $10,000 - $1000= $9000

Interest payable at the end of the second year = 6.5% of principal outstanding at the beginning of the second year = 6.5% of 9000

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Hence total payment at the end of the second year = $1000 + $585= $1585

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3 years ago
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The psycho-social context is a characteristic form of practice which emerged early in the development of the discipline. Their objectives are to restore sustain and improve people's personal and social functionality.

It developed considerably out of its Psychoanalytical and Ego conceptual foundations based on psychological and social concepts. New information on identity and gender has been implemented.

According to Erikson the full recognition and acknowledgement of the death is a sense of dignity. It is important to take responsibility for your own life and to be able to undo the mistakes and to please yourself. The inability to do so generates a hopeless feeling.

4 0
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