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3 years ago

What is the difference between a callable bond and a convertible bond?

2 answers:

4 0

Explanation:Convertible bonds. Are corporate bonds that can be converted by the holder into the common stock of the issuing company.

Callable bonds. Called provision option held by the company to repurchase the bond at specific price. Is also called redeemable bonds, jump up etc. While most callable bonds are coupon bonds.

There are no big differences between the two, convertible bonds are often callable, eg corporate bonds can be convertible/callable or the both.

umka2103 [35]3 years ago

3 0

A callable bond is a bond that can be called back in by the issuer prior to maturity. For example, a 10 year bond issued today could be called back in 8 years.

A convertible bond is a bond that converts into the equity of the underlying company. For example, the bond of XYZ company can be converted into the stock of XYZ company under certain conditions.

A convertible bond has the advantage in that there is upside when the owner converts into stock.

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Slim made a single deposit of $5,000 in an account that pays 7.2% in 2015. What equal-sized annual withdrawals can Slim make fro

evablogger [386]

Answer:

annual withdrawals is $1,393.87

Explanation:

given data

Amount Deposited = $5,000

Annual Interest Rate = 7.2%

First withdrawal = 2020

last withdrawal = 2025

solution

we consider equal sized annual withdrawals = x

so we can say that Amount Deposited amount will be as

$5,000 = $\frac{x}{(1+0.72)^5} + \frac{x}{(1+0.72)^6} + \frac{x}{(1+0.72)^7} + \frac{x}{(1+0.72)^8} + \frac{x}{(1+0.72)^9} + \frac{x}{(1+0.72)^{10}}$ ..........1

we take common here $\frac{x}{(1+0.72)^{4}}$

$5,000 = $\frac{x}{(1+0.72)^{4}} \times ( \frac{1}{(1+0.72)^1} + \frac{1}{(1+0.72)^2} + \frac{1}{(1+0.72)^3} + \frac{1}{(1+0.72)^4} + \frac{1}{(1+0.72)^5} + \frac{1}{(1+0.72)^{6}} )$

solve it we get

x = $1,393.87

so that annual withdrawals is $1,393.87

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2 years ago

The____________problem occurs when people fail to join a group because they can get the benefits the group offers without contri

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D. Group coordination

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3 years ago

A company had total sales of $980,000, net sales of $955,800 and an average accounts receivable of $82,500. Its accounts receiva

Alenkinab [10]

Answer:

Accounts receivable turnover = 11.58

Explanation:

The total sales of the company = $980000

Net sales of the company = $955800

Average account receivable = $82500

We have total sales, net sales, and average accounts receivable. Here, we are required to find the account turnover.

Use the below formula to find the account turnover:

Accounts receivable turnover = Net sales / average accounts receivable

Now insert the values:

Accounts receivable turnover = 955800 / 82500 = 11.58

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3 years ago

Market Research Reading Quiz QUESTION 5 of 10: Market research concerns what aspects of your target market: a Characteristics b)

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Answer:

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2 years ago

Pacific Packaging's ROE last year was only 3%, but its management has developed a new operating plan that calls for a debt-to-ca

777dan777 [17]

Answer:

Explanation:

Total asset turnover = Sales/total assets

3.2= 14000000/Total assets

Total assets = 4375000

E/A = 1-D/A = 1-0.45 = 0.55

Equity = E/A*assets = 0.55*4375000=2406250

Net income = (EBIT-interest)*(1-tax rate)

=(1344000-546000)*(1-0.25)=598500

ROE = Net income/total equity

ROE% = 598500/2406250=0.248

ROE% = 24.8

6 0

2 years ago