Answer:
Price = $3,241,718
Explanation:
To calculate issue price of the bonds we first calculate NPV of the bonds after 12 years and Interest payments of the bonds for 12 years.
NPV can be calculated by : Bond value * NPV factor after 12 years
so, Bond Value after 12 years = $3700 000 * 0.2567 = $949,790
We take the market interest rate for this.
Now we calculate Yearly interest payment = 3700000 * 10% = $370,000
we discount it back using annuity for 12 years so, 370000 * 6.1944 = $2,291,000. This is the total interest payments for 12 years in NPV terms.
To calculate issue price simply add Interest payments and Bond NPV value so,
Price = 2291000 + 949790 = $3,241,718
Hope that helps.
Answer:
C. Shareholders and providers of finance
Explanation:
A company's financial report communicates the financial health of a business. It indicates whether a business is profitable and can meet its financial obligations.
Shareholders are the owners of a business. They are interested in the financial reports to know if their venture is making profits. Shareholders expect to earn dividends from the business. Only a profitable business is able to declare dividends. Financial reports guide shareholders in making decisions regarding the future of the business.
Lenders provide debt capital to a business. If the company is profitable, then lenders are happy because their payments are assured. Lenders rely on financial reports in deciding whether to extend or deny credit to businesses.
Answer:
the payback period of the project is 3.57 years
Explanation:
The computation of the payback period is shown below;
Payback period:
= Initial investment ÷Cash inflows
= $100,000 ÷ $28,000
= 3.57 years
We simply divided the initial investment by the cash inflows so that the project payback period could come
Hence, the payback period of the project is 3.57 years
Answer:
Only final goods and services are included in the calculation of GDP to avoid counting things multiple times.
Explanation:
In the calculation of the GDP only final goods and services are included because the prices of the these already have the costs of all the things that were used to produce them. If we count the intermediate products and services that were used for the final output, we will be double counting which will give a result that is not a correct estimation.
The correct option is D.
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