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
Murljashka [212]
3 years ago
5

Sheridan Corp is looking to invest in a three-year bond that makes semi-annual coupon payments at a rate of 5.825 percent. If th

ese bonds have a market price of $985.63, what yield to maturity can she expect to earn?
Business
1 answer:
krek1111 [17]3 years ago
8 0

Answer:

The annual YTM will be = 0.063496 or 6.3496% rounded off to 6.35%

Explanation:

The yield to maturity or YTM is the yield or return that an investor can earn on the bond if the bond is purchased today and is held till the bond matures. The formula to calculate the Yield to maturity of a bond is as follows,

YTM = [ ( C + (F - P / n))  /  (F + P / 2) ]

Where,

  • C is the semi annual coupon payment  in case of semi annual bond
  • F is the Face value of the bond
  • P is the current value of the bond
  • n is the number of semi annual periods to maturity  in case of the semi annual coupon bond

Assuming that the face value of the bond is $1000.

Coupon payment - semi annual= 1000 * 0.05825 * 6/12 = 29.125

Number of semi annual periods = 3 * 2 = 6

YTM - semi annual= [ (29.125 + (1000 - 985.63 / 6))  /  (1000 + 985.63 / 2)

YTM - semi annual= 0.031748 or 3.1748% rounded off to 3.17%

The annual YTM will be = 0.031748 * 2 = 0.063496 or 6.3496% rounded off to 6.35%

You might be interested in
Cynthia Knott's oyster bar buys fresh Louisiana oysters for $5 per pound and sells them for $9 per pound. Any oysters not sold t
krek1111 [17]

Answer:

103

Explanation:

Please see attachment .

6 0
4 years ago
Review the following sources and decide if they are reliable and relevant.
JulsSmile [24]

Answer:

CNN business is left wing( which means it will tilt the info to fit the party)

Try using something neutral

6 0
3 years ago
PRO FORMA INCOME STATEMENT Austin Grocers recently reported the following 2016 income statement (in millions of dollars): Sales
padilas [110]

Answer:

Net income = $169.2

Growth in dividend = 76.25%

Explanation:

The projected figures are as below:

Sales = $700 x (1 + 15%) = $805 <em>(15% increase in sales)</em>

Operating costs including depreciation = $805 x 60% = $483 <em>(60% of sales)</em>

Interest expense = 40 <em>(remain constant)</em>

EBIT = Sales - Operating costs including depreciation = $805 - $483 = $322

EBT = EBIT - Interest expense = $322 - $40 = $282

Net income = EBT x (1 - Tax rate) = $282 x (1 - 40$) = $169.2

Dividend = Net income x Dividend payout ratio = $169.2 x (32/96) = $56.4

Growth in dividend = $56.4/$32 = 76.25%

<em />

4 0
3 years ago
If we assigned three people to work with you on a complex project containing 75 tasks that you were responsible for, how would y
Anni [7]
First of all, I will try to get to know people who were assigned to me. as I will have 75 tasks and equality is very important to me, I will give each person 25 task. if they will have some problems with given task I will try to help them or change their tasks so they can be more comfortable with their work. As a leader, i will do work as well, if my team will have some problems i will listen to them and solve those problems together. 
3 0
3 years ago
The two major markets in the circular flow of income and expenditure are the:________
Arada [10]

Answer:

[2] goods market and factor market.

Explanation:

The circular flow of income shows how exchange of money, goods and services occur in an economy.

the two flow circular income model consists of an household and a firm.

The household buys factors of production from the household in exchange for money (firms buys from the factor market). In return, households receive payment.

households then go to the goods market to purchase goods and services.

3 0
3 years ago
Other questions:
  • Indicate whether each of the following audit procedures is a test of controls, a substantive test, or dual-purpose test. Next, i
    6·1 answer
  • True or false: the price consumers pay will be higher if the tax were imposed on producers.
    12·1 answer
  • QUESTION 23
    14·1 answer
  • Bayest Manufacturing Corporation uses a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead
    9·1 answer
  • Javier left his home country to become a gardener for a family in a suburb of San Francisco, California. One of the benefits of
    11·1 answer
  • The Fox Company uses the weighted average method. The beginning work in process consists of 20,000 units (100% complete as to ma
    13·1 answer
  • On November 1, Year 2, Smith Co. contracted to dispose of an industry segment on February 28, Year 3. Throughout Year 2, the seg
    9·1 answer
  • What is true about economic resources? A) Economic resources include only money. B) Economic resources are limited. C) Economic
    9·2 answers
  • How does increased competition through FDI in the form of greenfield investments affect the host country
    10·1 answer
  • A unit volume objectives for pricing should be used judiciously because higher volume goals can sometimes result in Blank______.
    10·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!