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Serga [27]
3 years ago
6

g 2018: US Bond A is issued at par with annual coupon of 2% and maturity of 5 years with face value of $1,000. 2019: Interest ra

tes increase in the market 2020: US Bond B is issued at par today with annual coupon of 5% and a maturity of 3 years with face value of $1,000.What should the price of Bond A be today, 2020, with 3 years left to maturity, so that its yield to maturity is equal to the yield to maturity on Bond B
Business
1 answer:
makvit [3.9K]3 years ago
3 0

Answer:

$918.48

Explanation:

price of bond A after the interest rate increased to 5% and the time to maturity is 3 years:

PV of face value = $1,000 / (1 + 5%)³ = $863.84

PV of coupon payments = $20 x 2.7232 (PV annuity factor, 5%, 3 periods) = $54.46

Market value of bond A = $863.84 + $54.46 = $918.48

Since the market rate is higher than the coupon rate, the bond will sell at a discount.

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The best time to acquire technological literacy is before you have to apply for a job because ________.
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3 years ago
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Written communications fall into two categories: paper-based and electronic. Which of the following are paper-based messages? Ch
Harman [31]

Answer:

The correct answer is letter "B" and "C": Business letters; Interoffice memos.

Explanation:

Paper-based communications are means of transmitting information presented on paper. It is implemented in formal cases where there must be written support of a proposal or notification about the course of actions that will be taken in front of a claim case or problem, for instance. <em>Business letters </em>and<em> interoffice memos </em>fall under this category.

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3 years ago
Part of the lands' end business model includes purchasing products and then selling them again without any reprocessing. lands'
Musya8 [376]
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7 0
3 years ago
Nash's Trading Post, LLC had an increase in inventory of $88800. The cost of goods sold was $414400. There was a $22200 decrease
makkiz [27]

Answer: $525,400

Explanation:

From the question, we are informed that Nash's Trading Post, LLC had an increase in inventory of $88800, the cost of goods sold was $414400 and that there was a $22200 decrease in accounts payable from the prior period.

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4 0
3 years ago
After 160 customer reviews for the hotel, 65% were Excellent
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Answer: 104 reviews

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= 65/100 × 160

= 0.65 × 160

= 104

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4 0
3 years ago
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