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ozzi
3 years ago
15

Which of the following is an example of a market segment?

Business
1 answer:
Hatshy [7]3 years ago
4 0

Answer: The answer is "b. A group of individuals with different product requirements".

Explanation: The definition of a market segment refers to a homogeneous and large group of consumers that can be recognized within a market, who have similar desires, buying habits, and who will react similarly to the power of marketing.

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▼ Cash Flow Present Discounted Value Interest Rate is based on the notion that a dollar paid in the future is less valuable than
BigorU [14]

Answer:

5000 in 1 year at 4% = $4,807.6923

9000 in 2 year at 1% =

Explanation:

We will calculate the present value of the loan at maturity

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

Maturity 5000

time 1

rate 0.04

\frac{5000}{(1 + 0.04)^{1} } = PV

PV  $4,807.6923

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

Maturity 9000

time 2

rate 0.01

\frac{9000}{(1 + 0.01)^{2} } = PV

PV  $8,822.6644

8 0
3 years ago
Barbara Jones is interested in buying a five-year zero coupon bond with a face value of $1,000. She understands that the market
nordsb [41]

Answer:

Zero-cupon bond= $612.52

Explanation:

Giving the following information:

Face value= $1,000

Number of periods= 5 years

Interest rate= 10.3% = 0.103

<u>To calculate the price of the bond, we need to use the following formula:</u>

<u></u>

Zero-cupon bond= [face value/(1+i)^n]

Zero-cupon bond= [1,000 / (1.103^5)]

Zero-cupon bond= $612.52

7 0
2 years ago
Both Bond Bill and Bond Ted have 6.2 percent coupons, make semiannual payments, and are priced at par value. Bond Bill has 5 yea
iragen [17]

Answer:

a-1. Percentage change in the price of Bond Bill = -8.07%

a-2. Percentage change in the price of Bond Ted = -21.12%

b-1. Percentage change in the price of Bond Bill = 8.94%

b-1. Percentage change in the price of Bond Ted = 30.77%

c. See the attached excel file for the graph.

d. It tells us that the longer the term of a bond, the greater will be its interest rate risk.

Explanation:

The price of each bond can be calculated using the following excel function:

Bond price = -PV(YTM, NPER, PMT, FV) ........... (1)

Where;

a-1. If interest rates suddenly rise by 2 percent, what is the percentage change in the price of Bond Bill?

YTM = (6.2% + 2%) / Number of semiannuals in a year = 8.2% / 2 = 4.1%

NPER = Number of semiannuals to maturity = 5 * 2 = 10

PMT = Payment = Coupon rate * Face value = (6.2% / Number of semiannuals in a year) * 1000 = (6.2% / 2) * 1000 = $31

FV = Face value = Initial price of Bond Bill = $1,000

Substituting all the values into equation (1), we have:

New price of Bond Bill = -PV(4.1%, 10, 31, 1000)

Inputting =-PV(4.1%, 10, 31, 1000) in a cell in an excel file (Note: As done in the attached excel file), we have:

New price of Bond Bill = $919.29

Percentage change in the price of Bond Bill = ((New price of Bond Bill - Initial price of Bond Bill) / Initial price of Bond Bill) * 100 = (($919.29 - $1,000) / $1,000) * 100 = -8.07%

a-2. If interest rates suddenly rise by 2 percent, what is the percentage change in the price of Bond Ted?

YTM = (6.2% + 2%) / Number of semiannuals in a year = 8.2% / 2 = 4.1%

NPER = Number of semiannuals to maturity = 25 * 2 = 50

PMT = Payment = Coupon rate * Face value = (6.2% / Number of semiannuals in a year) * 1000 = (6.2% / 2) * 1000 = $31

FV = Face value = Initial price of Bond Ted = $1,000

Substituting all the values into equation (1), we have:

New price of Bond Ted = -PV(4.1%, 50, 31, 1000)

Inputting =-PV(4.1%, 50, 31, 1000) in a cell in an excel file (Note: As done in the attached excel file), we have:

New price of Bond Ted = $788.81

Percentage change in the price of Bond Ted = ((New price of Bond Ted - Initial price of Bond Bill Ted) / Initial price of Bond Ted) * 100 = (($788.81 - $1,000) / $1,000) * 100 = -21.12%

b-1. If rates were to suddenly fall by 2 percent instead, what would the percentage change in the price of Bond Bill be then?

YTM = (6.2% - 2%) / Number of semiannuals in a year = 4.2% / 2 = 2.1%

NPER = Number of semiannuals to maturity = 5 * 2 = 10

PMT = Payment = Coupon rate * Face value = (6.2% / Number of semiannuals in a year) * 1000 = (6.2% / 2) * 1000 = $31

FV = Face value = Initial price of Bond Bill = $1,000

Substituting all the values into equation (1), we have:

New price of Bond Bill = -PV(2.1%, 10, 31, 1000)

Inputting =-PV(2.1%, 10, 31, 1000) in a cell in an excel file (Note: As done in the attached excel file), we have:

New price of Bond Bill = $1,089.36

Percentage change in the price of Bond Bill = ((New price of Bond Bill - Initial price of Bond Bill) / Initial price of Bond Bill) * 100 = (($1,089.36 - $1,000) / $1,000) * 100 = 8.94%

b-2. If rates were to suddenly fall by 2 percent instead, what would the percentage change in the price of Bond Ted be then?

rate = new YTM = (6.2% - 2%) / Number of semiannuals in a year = 4.2% / 2 = 2.1%

NPER = Number of semiannuals to maturity = 25 * 2 = 50

PMT = Payment = Coupon rate * Face value = (6.2% / Number of semiannuals in a year) * 1000 = (6.2% / 2) * 1000 = $31

FV = Face value = Initial price of Bond Ted = $1,000

Substituting all the values into equation (1), we have:

New price of Bond Ted = -PV(2.1%, 50, 31, 1000)

Inputting =-PV(2.1%, 50, 31, 1000) in a cell in an excel file (Note: As done in the attached excel file), we have:

New price of Bond Ted = $1,307.73

Percentage change in the price of Bond Ted = ((New price of Bond Ted - Initial price of Bond Bill Ted) / Initial price of Bond Ted) * 100 = (($1,307.73 - $1,000) / $1,000) * 100 = 30.77%

c. Illustrate your answers by graphing bond prices versus YTM.

Note: See the attached excel file for the graph.

d. What does this problem tell you about the interest rate risk of longer-term bonds?

It tells us that the longer the term of a bond, the greater will be its interest rate risk.

Download xlsx
6 0
2 years ago
A technology company is growing rapidly and needs to hire experienced developers and marketing professionals. The best people in
Karolina [17]

Answer:

B

Explanation:

Use social media platforms like LinkedIn to screen for people with the relevant experience at high-performing companies

Using social media platform like Linkedin you would normally find the best and high- perfoming individuals, whomare definetly and most likely to meet the criteria for the job and even be beyond expectations. This has become a lot easier to use in this dispensation.

5 0
3 years ago
Read 2 more answers
Classifying Cash Flows Identify the type of cash flow activity for each of the following events (operating, investing, or financ
Sphinxa [80]

Answer:

Cash Flow activities for each event are:

a. Redeemed bonds                       (Financing activity)

b. Issued preferred stock              (Financing activity)

c. Paid cash dividends                   (Financing activity)

d. Net income                                  (Operating activity)

e. Sold equipment                         (Investing activity)

f.  Purchased treasury stock        (Financing activity)

g. Purchased patents                     (Investing activity)

h. Purchased buildings                   (Investing activity)

i. Sold long-term investments        (Investing activity)

j. Issued bonds                                (Financing activity)

k. Issued common stock                (Financing activity)

<u>NOTE</u>

-Operating activities entails cash activities related to net income.

-Investing activities encompasses cash activities related to non-current assets.

-Financing activities include cash activities related to owners' equity and non-current liabilities

7 0
3 years ago
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