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nalin [4]
2 years ago
11

Harrison Co. issued 14-year bonds one year ago at a coupon rate of 6.9 percent. The bonds make semiannual payments. If the YTM o

n these bonds is 5.5 percent, what is the current dollar price assuming a $1,000 par value?
Business
1 answer:
mixas84 [53]2 years ago
6 0

Answer:

Bond Price​= $1,128.82

Explanation:

Giving the following information:

Time= 13*2= 26

Cupon= (0.069/2)*1,000= 34.5

YTM= 0.055/2= 0.0275

Par value= $1,000

<u>To calculate the price of the bond, we need to use the following formula:</u>

Bond Price​= cupon*{[1 - (1+i)^-n] / i} + [face value/(1+i)^n]

Bond Price​= 34.5*{[1 - (1.0275^-26)] / 0.0275} + [1,000/(1.0275^26)]

Bond Price​= 634.88 + 493.94

Bond Price​= $1,128.82

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The rate of return on the common stock of Flowers by Flo is expected to be 14 percent in a boom economy, 8 percent in a normal e
FinnZ [79.3K]

Answer: The standard deviation of the stock is 3.23 percentage

Explanation:

First we shall calculate the epected weighted average return of the stock.

We shall multiply the probability of the scenario with its expected return and then take the sum of the expected returns of different scenarios,

E(x) = (0.2 x 14%) + (0.7 x 8%) + (0.1 x 2%)

E(x) = 8.6%

We shall use the follwing formula to calculate the Variance of the stock,

σ²(x) = ∑ P(x_{i}) × [x_{i} - E(r)]²

σ²(x)  = (0.2) (0.14 - 0.086)² + (0.7) (0.08 - 0.086)² + (0.1) (0.02 - 0.086)²

σ²(x) = 0.001044

To find the standar deviation,

σ(x) = \sqrt{0.001044}

σ(x) = 0.0323109

in percentage it would be 3.23%

7 0
3 years ago
The percentage of network programming on broadcast TV that involves sports is _______________________.
Dmitry_Shevchenko [17]

Answer: Fifty percent.

Explanation:

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3 years ago
Inbound marketing represents a fundamental shift in the way that organizations operate because it is ______-centric.
Natasha2012 [34]
<span>Inbound marketing represents a fundamental shift in the way that organizations operate because it is marketer-centric. This is an unconventional approach of systems since the usual ones is allowing the customers to be put first or customer-centric kind of approach. This kind builds the best relationship you can offer with the customer.</span>
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Digicon Inc. is a firm with mindshare in the category of digital cameras. With reference to this information, which of the follo
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d.The digital cameras manufactured by the firm are seen as the standard for competitors to match.

Explanation:

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Thus, the answer choice that better fits the description is d.The digital cameras manufactured by the firm are seen as the standard for competitors to match.

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3 years ago
a bond has a face value of $1,000, an annual coupon rate of 7 percent, yield to maturity of 10 percent, and 20 years to maturity
rewona [7]

The bond that has a face value of $1,000 has a duration of 10 years.

<h3>What is a bond?</h3>

A bond is a type of security in the financial world where the issuer (debtor) owes the holder (creditor) a debt and is required, depending on the terms, to repay the bond's principal (i.e., the amount borrowed) at the bond's maturity date as well as interest (referred to as the coupon) over a predetermined period of time. The interest is typically due at regular intervals, such as every six months, once a year, and less frequently at other times. To finance long-term investments or, in the case of government bonds, to finance immediate expenses, the borrower can obtain external funds through the sale of bonds. Both bonds and stocks are considered to be forms of security, but the main distinction between the two is that (capital) stockholders have an equity stake in a company, whereas bondholders have a creditor stake.

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1 year ago
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