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
dezoksy [38]
2 years ago
15

A $1,000 par bond with a semi-annual coupon and 12 years to maturity is currently priced $880 and has a yield to maturity of 5.3

7%. What is the bonds coupon rate
Business
1 answer:
jok3333 [9.3K]2 years ago
5 0

Answer:

Annual Coupon rate = 0.040005 or 4.0005% rounded off to 4.00%

Explanation:

To calculate the price of the bond today, we will use the formula for the price of the bond. We assume that the interest rate provided is stated in annual terms. As the bond is a semi annual bond, the coupon payment, number of periods and semi annual YTM will be,

Coupon Payment (C) = C

Total periods (n) = 12 * 2 = 24

r or YTM = 0.0537 * 6/12 = 0.02685 or 2.685%%

The formula to calculate the price of the bonds today is attached.

We will first calculate the value of semi coupon payment  made by the bond.

880 = C * [( 1 - (1+0.02685)^-24) / 0.02685]  + 1000 / (1+0.02685)^24

880 = C * 17.52482779  +  529.4583737

880 -  529.4583737  =  C * 17.52482779

350.5416263 / 17.52482779 = C

C = 20.0025718 rounded off to 20.00

 

The annual coupon payment will be = 20.0025718  * 2 = 40.00514361 rounded off to 40.01

Annual Coupon rate = 40.00514361  / 1000 = 0.040005 or 4.0005% rounded off to 4.00%

You might be interested in
Suppose the exchange rate is 10 pesos per dollar and you use $1000 to purchase a one-year mexican bond that pays 10% interest. N
Iteru [2.4K]

The amount of money I would have in US dollars would be $1,000

<h3>How much would I have in US dollars?</h3>

The first step is to convert dollars to pesos:

$1000 x 10 = 10,000 pesos

The second step is to determine the value of the investment in a year's time: (1.10) x 10,000 = 11,000 pesos

Now, convert pesos to dollars : 11,000 / 11 = $1,000

To learn more about exchange rate, please check : brainly.com/question/25780725

#SPJ1

6 0
2 years ago
1. Based on the above article, if you were an entrepreneur, which sector would fit you the most? Justify your answer by conducti
natita [175]

Answers:

1) As an entrepreneur, I would go the route of providing online fitness services combined with healthy foods that go with specific body types.

Feasibility

Justification: As people become more and more sedentary due to social distancing, a new health problem arises.

The human body was not built to be redundant. I was built for healthy activity. Exercising protects the heart and facilitates blood circulation. The increased blood flow boosts the levels of oxygen in the body.

When this happens, the risk of heart diseases such as high cholesterol, heart attack and coronary artery disease is reduced. Regular exercise can also reduce your blood pressure and the levels of triglycerides.

Exercising without eating properly also translates to serious health problems such as stamina, strength, and weight loss. So, providing consultative services on what to eat and how to eat them and who should eat what is a great complimentary add-on to the health and fitness service.

<em>Who needs the service?</em>

Except for those with serious health issues such as heart conditions, kidney diseases, etc everyone can and should exercise to prevent them becoming overweight.

People who will be able to afford our services going from the above analysis would fall in between middle income to High Net-worth Individuals.  

We will also be looking at businesses who would be interested in purchasing health/wellness programs such as ours for their staff.

<em>Why will they buy?</em>

We'd be providing continuous health tips, great eating habits and foods which are medicinal when eaten rightly.

Besides the cost of subscribing to our services and the cost of the recommended food types, and perhaps data subscriptions (which most already have) there is no other cost involved. There won't be a need for gymnastics equipment because our method of fitness training does not require such. It depends on the use of the body's weight. This is called Callisthenics.

<em>Our Unique Selling Point</em>

We will have in our employment, nutritionists with whom they can consult on the go depending on the type of subscription they opt for.

We will also have dedicated customer care personnel whose job will be to motivate and encourage clients towards their health and fitness goals

We will also have psychologists who will help people with body insecurity needs depending on which package they sign up for.

Assuming we charge a total market of 20 Million Americans who will sign up and pay $10 every month, that comes to two hundred million USD annually.  

We also charge for specialised services using the normal wage rates but not more than $10 per hour. This is to ensure that everyone buys into the program. 40% of our revenue will go into operational expenses including lump-sum payments monthly depending on initial sales.

Given the draft feasibility above, the company stands to make at least 60% of its income as profit when the market is fully developed and that comes to about $ 120 Million.

Besides investing in our staff, we'd invest in a great digital camera, mini studio and ancillary equipment for pre-recorded training.

2. Porter's 5 forces are:

  • The risk of new players
  • The risk of substitute products
  • Power of suppliers
  • Power of customers
  • Industry Competition

 

The risk of new players entering the market is significant. It all depends on the quality of expertise one is bringing on board. Many of our trainers are going to be people with many years of experience, sound academic qualifications and great results.  

The risk of substitute products /services.  As already stated above, our well-experienced trainers will have a profile that is difficult to surpass.

The risk of suppliers usurping our model is very low. We plan to build our network to gain very quickly loads and loads of followers in their millions such that we become a great platform for suppliers of vitamin supplements, healthy packaged food products etc to sell their goods.  

Customers are always king. They hold the key to the business. That is why we will have highly trained, kind, professional, customer care personnel to cater to the needs of our clients.

Industry Competition: This is to be expected. To win the competition, we will adopt the differentiation strategy, and cost focus strategy while delivering quality care.

3. Given the above, I strongly believe that it is possible to enter with a niche strategy. There were loads of chat services which entered the market when it looked saturated but have now broken through. Our strategy in terms of pricing will be crafted such that it fits our market entry model.

4. At the time of writing this, I definitely would consider launching a business in this sector. The opportunities are enormous. It is a global market which requires specialised training. Total cost of set-up is on the low side and potential profit is very high.

Cheers!  

Download txt
6 0
3 years ago
Unemployment is often called a lagging or trailing indicator because unemployment tends to rise some time after the economy begi
andrezito [222]

Answer:

B) firms reduce hours before laying off when the economy is in recession, and increase hours before hiring when the economy expands.

Explanation:

In the case when the output falls so the workers would not be laid off in a direct manner. In the first time the labor would be decreased so that the demand could be analyzed. The same would be happen in that case also where the growth picked up

Therefore in the given case, the option B is correct

And the other options are wrong

7 0
2 years ago
Currently, the U.S. Olympic Committee (USOC) pays Olympic athletes $25,000 for each gold medal, $15,000 for a silver medal, and
katrin2010 [14]

Answer:

Disability Discrimination

Explanation:

Disability Discrimination is a form of inequity or unfairness that individuals aer forced to witness, endure or suffer as a result of their association with a disabled person, a perceived disability or an actual disability. This discrimination arise in different situations and they are both physical and mental.

Disability discrimination is often witnessed in employment in issues including; recruitments, promotions, trainings, lay-ffs, leaves, benefits and payments.

In this particular question, disability discrimination is a kind of inequity obvious in the fact that Paralympic athletes are only paid 10 percent of what the Olympic athletes receive, despite the fact that they are engaged in similar physical activities. The fact that is the same U.S Olympic Committe (USOC) that pays both set of athletes makes it a form of employment inequity in form of disability discrimination.

7 0
3 years ago
The Copy Department in the College of Business at State University provides photocopying service for both the Marketing and Econ
fiasKO [112]

Answer:

The correct answer is $170,000.

Explanation:

According to the scenario, computation of the given data are as follows:

We can calculate the cost allocated to Marketing by using following formula:

Total cost allocated = Fixed cost + Variable cost

Where, Fixed cost = (3,600,000 ÷ 5,400,000) × $120,000

= $80,000

And , Variable cost = $0.025 × 3,600,000 = $90,000

By putting the value, we get

Total cost allocated = $80,000 + $90,000

= $170,000

7 0
2 years ago
Other questions:
  • Suppose the united states has two​ utilities, commonwealth utilities and consolidated electric. both produce 20 million tons of
    9·1 answer
  • The given treasury bill was sold in april of this year. find (i) the price of the t-bill, and (ii) the actual interest rate paid
    13·1 answer
  • "Phillips and Sanchez is a retailer that operates a national chain of home furnishings stores. It has designed a website and a s
    14·1 answer
  • Assume the appropriate discount rate for the following cash flows is 4.78 percent per
    8·1 answer
  • 1.) What are the three personal traits that help you most in the business world?
    7·1 answer
  • Career Cluster
    5·1 answer
  • Six acres of prime undeveloped property are sold for $2.25 per square foot. how much did the buyer pay?
    11·1 answer
  • A firm has a marginal cost of $20 and charges a price of $40. the lerner index for this firm is? 0.33. 0.20. 0.50. 0.75.
    13·1 answer
  • If firms are producing at a profit-maximizing level of output where the price is less than the average total cost:_________
    11·1 answer
  • If the world price for good a is above the domestic price for good a without trade, then consumer surplus will ________ and prod
    10·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!