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
qaws [65]
3 years ago
12

Suppose that 2 years after the issue date (as in Part a) interest rates fell to 8%. Suppose further that the interest rate remai

ned at 8% for the next 8 years. What would happen to the price of the bonds over time
Business
1 answer:
Elenna [48]3 years ago
5 0

Answer:

the first part of the question is missing, so I looked fro a similar one:

<em>Suppose Hillard Manufacturing sold an issue of bonds with a 10-year maturity, a $1,000 par value, a 10% coupon rate, and semiannual interest payments.</em>

the market price of the bond after 2 years:

PV of face value = $1,000 / (1 + 4%)¹⁶ = $533.91

PV of coupon payment = $50 x 11.652 (PV annuity factor, 4%, 16 periods) = $582.60

market price = $1,116.51

the market price of the bond after 5 years:

PV of face value = $1,000 / (1 + 4%)⁶ = $790.31

PV of coupon payment = $50 x 5.2421 (PV annuity factor, 4%, 6 periods) = $262.11

market price = $1,052.42

the market price of the bond after 7 years:

PV of face value = $1,000 / (1 + 4%)² = $924.56

PV of coupon payment = $50 x 1.8861 (PV annuity factor, 4%, 2 periods) = $94.31

market price = $1,018.87

You might be interested in
A(n) _____ is an organization of talented artists who work for advertisers and occasionally subcontract to advertising agencies.
Elena L [17]

A creative boutique is an organization of talented artists who work for advertisers and occasionally subcontract to advertising agencies. Its mission is to develop exciting creative concepts and to produce fresh, distinctive advertising messages.

7 0
3 years ago
If you hope to be a college instructor in a subject, you need to plan to complete what level of education?
vazorg [7]
Hey if you hope to be a college instructor in a subject you need to plan to complete B. BACHELORS DEGREE
i hope it helps!
4 0
3 years ago
Which statement is true of both credit cards and debit cards?
ElenaW [278]

Answer:

D

Explanation:

They are linked to a checking or savings account.

5 0
2 years ago
Hitzu Co. sold a copier (that costs $4,800) for $6,000 cash with a two-year parts warranty to a customer on August 16 of Year 1.
den301095 [7]

Answer:

warranty expense = $240

estimated warranty liability = $240

Explanation:

There is no option on the customer to take the warranty or not. Therefore this type of warranty is known as an Assurance type warranty.

Assurance type warranties are accounted for terms of IAS 37 - Provisions as follows ;

Year 1

Warranty expense $240 (debit)

Warranty Provision $240 (credit)

<em>Warranty Amount = $6,000 × 4% = $240</em>

Year 2

<em>When warranty claim is subsequently received</em>

Warranty Provision $209 (debit)

Materials $209 (credit)

7 0
3 years ago
A company works 320 days per year and has an annual demand of 2080 units of product desires to set an reorder point that will co
melisa1 [442]

Answer:

reorder point= 39 units

Explanation:

given data:

Annual demand = 2240 units.

No of days = 320

lead time is 4 working days

As we know,

Reorder point= Lead time demand + Safety stock

Lead time demand = Average daily usage * lead time

Average daily usage = \frac{Annual demand}{No of days operating in year }

average  Daily usage = \frac{2080}{320}= 6.5 units per day.

Lead time demand = 6.5* 4 = 26 units.

Safety stock = 2 days of average demand

= 2*6.5 = 13 units.

Hence reorder point= 26 + 13= 39 units.

4 0
3 years ago
Other questions:
  • When does the appraisal process begin?
    5·1 answer
  • _ is concerned with determining what activities should be performed and assessing how well they are performed. a.Operational con
    12·1 answer
  • Watson Foods, Inc. reported the following transactions for September 2019.
    13·1 answer
  • Mining companies, farms, financial services, and fisheries are all examples of: transactional markets. cooperative markets. rese
    10·1 answer
  • A good investment should do one or both of which two things
    10·2 answers
  • A certain bank assigns one unique number to each savings account. The amount of savings in each account depends on how much the
    9·2 answers
  • Question 20 poin
    9·1 answer
  • During the current month, Wacholz Company incurs the following manufacturing costs.
    5·1 answer
  • The most recent financial statements for Summer Tyme, Inc., are shown here:
    9·1 answer
  • nokia reportedly dismissed the original iphone with its large glass surface partly because it failed one of nokia's own ruggedne
    10·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!