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
aev [14]
3 years ago
9

Bond X is noncallable and has 20 years to maturity, a 11% annual coupon, and a $1,000 par value. Your required return on Bond X

is 12%; if you buy it, you plan to hold it for 5 years. You (and the market) have expectations that in 5 years, the yield to maturity on a 15-year bond with similar risk will be 7%. How much should you be willing to pay for Bond X today
Business
1 answer:
Virty [35]3 years ago
8 0

Answer:

Present value = $1,170.68

Explanation:

The value of the bond in 5 years will be:

PV of face value = $1,000 / (1 + 7%)¹⁵ = $362.45

PV of coupon payments = $110 x 9.1079 (PVIFA, 15 periods, 7%) = $1,001.87

Total value = $1,364.32

The current value of the bond is:

PV of face value = $1,364.32 / (1 + 12%)⁵ = $774.15

PV of coupon payments = $110 x 3.6048 (PVIFA, 5 periods, 12%) = $396.53

Present value = $1,170.68

You might be interested in
waller company does business in two regional segments: north and south. the following annual revenue information was determined
Alla [95]

Answer:

Detaled solution can be seen in the attached diagrams:

8 0
3 years ago
Required: Accounting equation Ans: assets, capital, liabilities SE-2. You are provided the following information: i. Commencemen
Tasya [4]

Answer:

<h2> particular. l.f. Dr. rs. Cr. rs. </h2>

I) bank a/c. 1,00,00.

to capital a/c. 1,00,00

( being business started with bank balance)

II) purchase a/c 40,000.

to bank a/c. 40,000

(being goods purchased on credit)

III) BANK A/C 20,000.

TO GOODS A/C 20,000

(BEING GOODS SOLD ON CREDIT)

IV) FURNITURE A/C. 60,000.

TO BANK A/C. 60,000

(BEING FURNITURE PURCHASED ON CREDIT)

V) BANK A/C. 10,000.

TO FURNITURE A/C 10,000

(BEING FURNITURE SOLD ON CREDIT)

HOPE IT HELPS IM ALSO NOT COMPLETELY PERFECT AT IT

3 0
3 years ago
Assume Countries A, B, and C produce goods that are substitutes of each other and that these countries engage in trade with each
sveticcg [70]

Answer:

The answer is: C) decrease; increase

Explanation:

Currency appreciation occurs when the value of one currency increases in relation to another currency. In this case, country A´s currency will gain value against the currency of countries B and C (C´s currency is pegged to B´s currency).

This means that products from country A will be more expensive than products from countries B and C, which should lower country A´s exports and increase its imports.

6 0
3 years ago
Imagine you are in the process of buying a new car. Give at least two examples of both qualitative and quantitative data that yo
Step2247 [10]

Answer with Explanation:

Qualitative attributes would be the Quality of steel used, interior and exterior design of the car, additional features that it offers, etc.

These attributes are qualitative characteristics of cars because they give us feeling of superiority over other similar items. Hence the strength of steel used clearly reflects the strength of car, interior design gives comfort, exterior design increases sense of superiority, additional features that the car offers will give upperhand over other cars.

All these features of car are qualitative because these can not be measured in numbers. On the other hand, Quantitative attributes includes price of spare parts, car and mileage per litre.

Quantitative attributes are reflected in numbers and thus are more desicive in nature.

3 0
3 years ago
Effective team functioning is critical in ensuring the best performance. Which of these characteristics is critical in team lead
sladkih [1.3K]
<h2>Maintain Situational awareness (Option A)</h2>

Explanation:

Option A:

A good leader should have good presence of mind, should be good at acting wisely during critical situation and show is smartness based on the situation. Smart work best works in most of the critical situation.

Option B: No organization makes anyone sole responsible because both victory and defeat needs to be shared by team since everything is team work.

Option C: Discussion is always desired among team member because it is team work and a leader will lead a team.

Option D: Taking multiple job is not so fair unless and until it is measurable and achievable.

8 0
3 years ago
Other questions:
  • Prime Corp. has an ending balance in the accounts receivable account of $100,000. Prime recorded bed debt expense of $3000. Prim
    8·1 answer
  • You are given the following information for Bowie Pizza Co.: Sales = $64,000; Costs = $30,700; Addition to retained earnings = $
    15·1 answer
  • Kerry wants to start a business to sell handmade jewelry. She is very competent at making the jewelry and teaching others to mak
    11·1 answer
  • The owner is his or her own boss
    5·1 answer
  • Okun’s law suggests that:
    12·1 answer
  • Marcus has decided to open an auto detailing business. He will pick up an automobile from the​ client, take it to his​ parents'
    13·1 answer
  • Alex has allocated his income in such a way that the marginal utility of the last unit of product X he consumes is 40 utils and
    15·1 answer
  • A ________ consists of selecting a segment of the market as the company's target market and designing the proper "mix" of produc
    14·1 answer
  • What are types of promotion.
    9·2 answers
  • Charlize is monitoring market indicators in a particular area for her client who wants to buy an oceanfront home. Which market i
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!