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xenn [34]
4 years ago
12

TravelEasy Inc. has issued 30-year semiannual coupon bonds with a face value of $1,000. If the annual coupon rate is 14% and the

current yield to maturity is 8%, what is the firm's current price per bond?
Business
1 answer:
rosijanka [135]4 years ago
5 0

Answer:

Coupon (R) = 14% x $1,000 = $140

Bond yield (kd) = 8% = 0.08

No of years (n) = 30 years

No of compounding periods (m) = 2

Po= R/m(1-(1+Kd/m)-nm/Kd/m + FV/(1+Kd/m)nm

Po = $140/2<u>(1-(1+0.08/2)</u>-30x2 + 1,000(1+0.08/2)30x2

                         0.08/2

Po = $70<u>(1-(1+0.04)</u>-60 + 1,000/(1 + 0.04)60

                       0.04

Po = $70<u>(1-(1.04)</u>-60 + 1,000/(1.04)60

                 0.04

Po = 70(22.6235) + 95.06

Po = $1,678.71

Explanation:

The price of a bond is equal to the present value of coupon plus the present value of the face value.

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The natural state of a market where network effects are present is for there to be intense competition between several rivals th
bixtya [17]

Answer:

False

Explanation:

The reason is that the network effect increases the value driven from a product when the users of the product grows. So the intense competition will come to equilibrium when the network effect is lower because the user needs are lower and the value required is also lower. So the market will be competing on prices to increase the demand of their product.

6 0
4 years ago
Misbah Corporation manufactures two styles of lampslong dasha Bedford Lamp and a Lowell Lamp. The following per unit data are​ a
kvasek [131]

Answer:

D. 8.000 Bedford Lamps and 2.500 Lowell Lamps

Explanation:

The computation of the optimum operating income is shown below:

Particulars          Bedford Lamp         Lowell Lamp

Sales price          $30                         $35

Less: Variable costs $18                         $ 23

Contribution                 $12                         $12

Machine hours           2                          4

Contribution per machine hour 6 3

(Bedford = 12 ÷ 2, Lowell = 12 ÷ 4)  

As we can see that the contribution margin per hour of Bedford Lamp is more than that of Lowell lamp so  the production of Bedford Lamp should produced first and then Lowell Lamp.

And, required hours to make 8,000 units of bedford lamp is

= 8,000 × 2

= 16.000 hours

Now Balance Hours is

= 260,00 - 16,000

= 10,000 hours  

Lowell lamp that can be made from 10000 hours is

= 10,000 ÷ 4

= 2,500 Lowel Lamps

3 0
3 years ago
Strong economic growth since 1960 has allowed nations like Singapore and Ireland to surpass nations such as the United Kingdom a
djyliett [7]

Answer:

A. True.

Explanation:

Making a comparison among countries of GDP per capita and Ireland and Singapore show higher values than the United Kingdom and France and this is because these two countries have experienced long periods of rapid growth with ratas higher than growth population. The United Kingdom and France, as mature economies economically growth also, but at a lower rate

3 0
4 years ago
What are some of the strategies that you currently use to make consumer
horsena [70]

<u>Answer:</u>

Consumer behavior considers numerous reasons why individual, situational, mental, and social individuals look for items, purchase, use, and afterward discard them.

Evaluative criteria are positive qualities that are imperative to you, for example, the cost of the knapsack, the size, the number of compartments, and shading. A portion of these attributes are valued highly as compared to others. For instance, the size of the rucksack and the cost may be more imperative to you than the shading except if, state, the shading is hot pink, and you despise pink.

8 0
3 years ago
Read 2 more answers
The ____ rule explains variation in employee conduct through generalizing on the percentage of employees in any given organizati
lana [24]

Answer: 10/40/40/10

Explanation:

Under the 10/40/40/10 rule, 10% of the employees tend to follow ones own attitudes and values, i.e. they believe that their beliefs are more remarkable than those around them. 40% of the employees try to go along with the organization policies. The other 40% might follow their assigned work group whereas the last 10% tend to take advantage of such circumstances just in case if degree of penalization is lower to that of the benefit and also risk of  getting caught is less.

7 0
4 years ago
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