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cluponka [151]
3 years ago
13

has issued bonds that have a 8% coupon rate, payable semiannually. The bonds mature in 8 years, have a face value of $1,000, and

a yield to maturity of 5%. What is the price of the bonds
Business
1 answer:
snow_tiger [21]3 years ago
3 0

Answer:

Bond Price​= $1,195.82

Explanation:

Giving the following information:

Face value= $1,000

YTM= 0.05/2= 0.025

Years tomaturity= 8*2= 16 semesters

Coupon= (0.08/2)*1,000= $40

<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​= 40*{[1 - (1.025^-16)] / 0.025} + [1,000/(1.025^16)]

Bond Price​= 522.2 + 673.62

Bond Price​= $1,195.82

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Part (a) Net Income Computation:

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Cost of goods sold             <u>(</u><u>$290</u><u>)</u>

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Collection from Sales                  $710

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3 years ago
In the components of a business plan, what section contains a detailed description of the company, the problem/opportunity, prop
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In the components of a business plan, the section which contains a detailed description of the company, the problem/opportunity, proposed solution to be offered, and your competitive advantage is "Financial Projections section"

<h3>What is Financial Projections?</h3>

Financial predictions forecast your company's future revenues and expenses using existing and estimated financial data.

They frequently contain many scenarios so you may see how adjustments to one part of your finances (for example, increased sales or reduced operational expenses) may affect your profitability.

Financial predictions are an important tool for business planning for a variety of reasons.

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To know more about the financial projections, here

brainly.com/question/21773027

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= 0.15 × 100

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Hence Catherine contributes 15% towards the total coverage

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