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
darby writes a check to education loan management inc, that is drawn on darbys account at federal bank. if thr bank does not acc
Aleksandr-060686 [28]
<span>Liability is on Darby because they were the one to write the original check and give it to the education loan management inc. Since the check wasn't accepted they have to take responsibility and liability for the fact that it was not accepted.</span>
5 0
3 years ago
Sunland Company gathered the following reconciling information in preparing its July bank reconciliation:
nikdorinn [45]

Answer:

the adjusted cash balance per book is $25,390

Explanation:

The computation of the adjusted cash balance per book is shown below

= Cash balance per books + Notes receivable and interest collected by the bank - Bank charge for check printing - NSF check

= $21,600 + $4,440 - $70 - $580

= $25,390

Hence, the adjusted cash balance per book is $25,390

We simply applied the above formula so that the correct value could come

And, the same is to be considered

7 0
3 years ago
A company purchased a commercial dishwasher by paying cash of $4,200. The dishwasher's fair value on the date of the purchase wa
kogti [31]

Answer:

$4,760

Explanation:

The value a company will record for the dishwasher will be the amount that was used to purchase the dishwasher plus the associated cost of transporting and installing the dishwasher.

The price of the dishwasher to be used is the actual amount it was bought and not the fair value.

Amount recorded for dishwasher= Price + Transportation + Installation fees

Amount recorded for dishwasher= 4,200 + 330 + 230

Amount recorded for dishwasher= $4,760

Note the fee for illegal parking is not considered because it is not a direct cost related to purchase of the dishwasher

5 0
2 years ago
John's band's Facebook page has 17,000 likes. If each of his fans has friends that number 15 percent of the likes that John has,
ch4aika [34]
17,000 * 17,000 * 0.15 = 43,350,000
(Hope this helps...)
6 0
2 years ago
Read 2 more answers
Suppose portable radios can be imported at a world price of $10 per radio. If trade were unencumbered, what would the new market
Harman [31]

Answer:

Domestic demand: Q = 5,000 – 100P; Supply: Q = 150P

At equilibrium, demand equals supply.

5,000 – 100P = 150P

250P = 5,000

P = 5,000/250

Equilibrium price (P) = $20

Substituting P in demand equation:

Q = 5,000 – (100*20)

Equilibrium quantity (Q) = 3,000 portable radio would be imported

6 0
3 years ago
Other questions:
  • 2. Describe three things that you think are important for a company to include in its personnel policies. (1-3 sentences. 1.5 po
    14·1 answer
  • If a higher level of production allows workers to specialize in particular tasks, a firm will likely exhibit ________ of scale a
    7·1 answer
  • If user experience of a product is poor, _____________. Select the options that correlate with the given statement.
    6·1 answer
  • Total Variable Overhead Variance Mulliner Company showed the following information for the year: Standard variable overhead rate
    8·1 answer
  • You are the international manager of a U.S. business that has just developed a revolutionary new personal computer that can perf
    5·1 answer
  • Co-marketing refers to _____.
    7·1 answer
  • What does required fields mean someone please answer
    14·2 answers
  • suppose you are advising a mayoral candidate in your town. the candidate’s platform includes strong opposition to monopoly suppl
    8·1 answer
  • Yields on municipal bonds are typically ___________ yields on corporate bonds of similar risk and time to maturity.
    10·1 answer
  • How can financial risks in a supply chain be managed?
    10·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!