1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
chubhunter [2.5K]
3 years ago
7

A risk-free bond will pay you $1,000 in 2 years and nothing in between. The annual discount rate is i=27.5% compounded annually.

What is the bond's present value?
Business
1 answer:
denis23 [38]3 years ago
3 0

Answer:

$615.15

Explanation:

Since we have only one cashflow at the end of 2 years and no coupons, find present value (PV). You can use a financial calculator and input the following;

Future value ; FV = 1,000

Duration; N = 2

Interest rate; I/Y = 27.5%

Coupon payments ;PMT = 0

then compute present value; CPT PV = 615.148

Therefore, the bond's PV is $615.15

You might be interested in
Which of these transactions occurring in 2011 would contribute to gdp for 2011?
skad [1K]

The transactions occurring in 2011 that would contribute to gdp (Gross Domestic Product) for 2011 is : Boeing sells a 787 aircraft produced in 2011 to a Korean airline.

8 0
3 years ago
Looking at four pillars of a healthy relationship (trust, respect, support and communication), how would you as a health care le
serg [7]
Like Michael Jackson once said. Look at the man in the mirror and make a change. and then help others to address their problems
7 0
3 years ago
When a wealthy individual invests his or her own money into a business project or start-up company with little intention to infl
kaheart [24]

​The answer is: Angel investor

Angel investors only injected their capital with the businesses if they believe that the leaders are capable in making the decision by their own.

This hands-off approach in investments tend to be reall risky. But Angel investors tend to be wealthy enough to the point where they can afford the financial blow back even if a couple of their start up investments fail.

7 0
3 years ago
Some checking accounts require a minimum amount of money in the account or they charge point monthly fees?
QveST [7]

Answer:

True

Explanation:

4 0
2 years ago
. Consider an economy that produces only chocolate bars. In year 1, the quantity produced is 4 bars and the price is $4. In year
NikAS [45]

Answer:

Nominal GDP in year 1 = $16

Nominal GDP in year 2 = $25

Nominal GDP in year 3  = $36

Explanation:

Gross domestic product is the total sum of final goods and services produced in an economy within a given period which is usually a year

GDP calculated using the expenditure approach = Consumption spending by households + Investment spending by businesses + Government spending + Net export

Net export = exports – imports

Nominal GDP is GDP calculated using current year prices

Nominal GDP in year 1 = 4 x $4 = $16

Nominal GDP in year 2 = 5 x $5 = $25

Nominal GDP in year 3 = 6 x $6 = $36

5 0
3 years ago
Other questions:
  • Firms that listen to existing customers and tailor offerings based on this input are far more likely to identify potentially dis
    12·1 answer
  • Which of the following is NOT an example of a liquid asset?
    6·1 answer
  • Fizzy Cola acquired 45% of the voting stock of National Bottlers on January 1, 2017, at a cost of $55,000,000, an amount equal t
    5·1 answer
  • Free market economies distribute goods and services than command economies.
    11·1 answer
  • The margin requirement on a stock purchase is 25%. You fully use the margin allowed to purchase 100 shares of MSFT at $25.
    15·1 answer
  • Bert sells his car to Conrad for $5,000 and his bike to Del for $600. Bert sells his vinyl collection to Elena for $1,000 and hi
    8·1 answer
  • GUYS PLEASE HELP ME WITH FINANCIAL PLAN FOR COMPANY OF CONFECTIONERY PRODUCTS BASED ON COFFEE!!!!! 1)Set the price of product an
    14·2 answers
  • 1. Machine A and Machine B can produce 1 widget in 3 hours working together at their respective constant rates. If Machine A's s
    11·1 answer
  • Hey i need help with sum
    13·1 answer
  • Anna is creating a personal balance sheet. she plans to list these items. bank account jewelry health insurance rent which state
    12·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!