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irakobra [83]
3 years ago
13

Navistar Electric issued 1000 debenture bonds 2 years ago with a face value of $5,000 each and a bond interest rate of 15% per y

ear payable semiannually. The bonds have a maturity date of 20 years from the date they were issued. If the interest rate in the market place is 10% per year compounded semiannually, determine the present worth today of one bond.
Business
1 answer:
Natasha2012 [34]3 years ago
4 0

Answer:

$7,081.25

Explanation:

Face value = 5000

Coupon = 15% paid annually. Semi annual payment = 750/2 = 375

Time to maturity = 18 years

Interest rate = 10% compounded semi-annually

P = 375(P|A, 5%, 36) + 5000(P|F, 5%, 36)

P = 375(16.58131488) + 5000(0.17265193)

P = 6217.99308 + 863.25965

P = 7081.25273

P = $7,081.25

So, the present worth of one bond today is  $7,081.25

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an investor buys a 10000 par 4.25 percent annual coupon tips security with three years to maturity. if inflation every sic month
mr_godi [17]

Answer:

the  final payment that investor would received is $11,843.36

Explanation:

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8 0
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The seller must cover the mortgage, closing costs, and brokerage fee. Once these expenses are covered, the down payment is added. This adds the minimum amount for the house price.

Mortgage      290,000  

Closing costs            1,400

Brokerage fee       <u>  17,400</u> (6% * 290,000)

<h3>Total Expenses 308,800</h3>

Down payment       <u>   55,000</u>

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