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Alja [10]
2 years ago
10

Goofy Inc.'s bonds currently sell for $925. They pay a $80 annual coupon, have a 25-year maturity, and a $1,000 par value. Compu

te the expected capital gain percentage for this year. (State as a percent, but do not include the percent sign and round to the second decimal place. Thus, 9.8765% would be written as 9.88 to be correct). (Hint: first compute the YTM and then find the capital gain.
Business
1 answer:
statuscvo [17]2 years ago
7 0

Answer and Explanation:

The computation of the YTM is shown below:

Given that

Future value be $1,000

NPER is 25

PMT is $80

Present value is $925

The formula is shown below:

=RATE(NPER,PMT,-PV,FV,TYPE)

After applying the above formula, the yield to maturity is 8.75%

Now the capital gain is

= 8.75% - ($80 ÷ $925)

= 8.75% - 8.65%

= 0.10%

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White raven [17]

Answer:

The sacrifice ratio could be as small as 0

Explanation:

The Sacrifice Rate is the loss of output due to the fight against inflation, and can be expressed as how much product is lost to reduce inflation by 1 percentage point. The Sacrifice Rate is a proposition by economist Robert Lucas Jr, who noted that the slowdown in long-term inflation is associated with a reduction in the production of goods and services over a period of time until economic agents adapt to the new reality. pricing and restructuring their expectations of the economy. Therefore, the social cost of fighting inflation is a reduction in GDP and an increase in the unemployment rate.

Because of this, we can conclude that if policymakers are committed to reducing inflation and rational people understand this commitment and quickly reduce their inflation expectations, the sacrifice rate can be as low as 0.

7 0
2 years ago
What are two examples of Secondary or non-core activities?
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One example is “engagement” consider to be “business activities”
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2 years ago
An industry with oligopolistic competition faces falling profits and its sales growth is slow. Demand for individual brands has
viva [34]

Answer: (A) Market maturity

Explanation:

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Therefore, Option (A) is correct.  

8 0
3 years ago
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Tayco Corporation has just paid dividends of $3 per share. The earnings per share for the company was $4. If you believe that th
tino4ka555 [31]

Answer:

the price earning ratio is 8.33

Explanation:

The computation of the price earning ratio is shown below:

P/E Ratio is

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Hence, the price earning ratio is 8.33

8 0
3 years ago
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