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
aksik [14]
3 years ago
11

All else constant, a coupon bond that is selling at a premium, must have:

Business
1 answer:
elena-14-01-66 [18.8K]3 years ago
3 0

Answer:

<em>a. A yield to maturity that is less than the coupon rate.</em>

Explanation:

If a coupon bond is selling at <em>premium</em>, this implies its current market price is higher than its par (face) value. But the coupon rate remains the same. So, since the price of bond has risen, the current market interest rate <em>(yield to maturity)</em> has to be less than the <em>coupon rate</em>. This is because the interest payment should be near about same or identical in case, when the bond is selling at premium and also in the case when the bond was selling at its par rate or value.

Hence, to arrive at around about the same interest payment, <em>all else constant, a coupon bond that is selling at a premium, must have a yield to maturity that is less than the coupon rate.</em>

You might be interested in
Precision Tool requires a 12 percent rate of return and uses straight-line depreciation to a zero book value over the life of it
7nadin3 [17]

Answer: -$273,747.85

Explanation:

EAC of machine = Net Present Value / Present value interest factor of Annuity(PVIFA)

Net Present value = Present value of cashflow - Initial investment

= -26,300 * PVIFA, 12%, 5 years - 892,000

= -26,300 * 3.6048 - 892,000

= -$986,806.24

EAC of machine = -986,806.24/ 3.6048

= -$273,747.85

6 0
3 years ago
Which of the following best explains why most people don’t consume units of goods to the point that their marginal utility falls
Oksana_A [137]

Explanation:

xxxxoxoxoxoxoxoxxooxoxpxpxpxpxpxpxppx0x

5 1
3 years ago
Read 2 more answers
You have been given this probability distribution for the holding period return for KMP Stock State of the Economy Boom Normal R
Hunter-Best [27]

Answer: The answer is a

Explanation:

Using the formula

Expected Rate of Return = ∑(i =1 to n) Ri Pi

Where Ri = Return in scenario 1

Pi = Probability for the return in scenario 1

i = Number of scenario

n = Total number of probability and Return

P1=30

R1 = 18

P2 = 50

R2 =12

P3 = 20

R3 =-5

Expected Gain =(30 ×18) + (50 × 12) + ( 20 × -5)

= 540 + 600 + - 100

= 1,040

= 1,040 ÷ 100

= 10.4%

7 0
4 years ago
Brian just began graduate school at the local university and is looking to rent an apartment. A family friend has decided to lea
TiliK225 [7]

Answer:

c) periodic tenancy

Explanation:

A periodic tenancy continues for successive periods until the tenant gives the landlord notification that he or she wants to terminate the tenancy. Such a tenancy may not define the duration of the tenancy and may be expressly stated or implied. Brian's situation describes a periodic tenancy.

3 0
3 years ago
A market-oriented organization targets its products at "everybody" or "the average customer."
Doss [256]
I’d go with false ..
7 0
4 years ago
Other questions:
  • Suppose that Georgiania was a thriving empire in its golden age. Business was booming and it was the center of international tra
    5·1 answer
  • Carrot Corporation, a C corporation, has a net short-term capital gain of $65,000 and a net long-term capital loss of $250,000 d
    8·1 answer
  • The liquidity component of the CAMELS rating refers to ____
    11·1 answer
  • Complete the following statement. The purpose of the closing process is to reset temporary (temporary/permanent) account balance
    7·1 answer
  • Which of the following comparisons is correct?
    9·1 answer
  • Every time Tess brings her bike in for service, the work is done well and her bike is ready to be picked up at the promised time
    7·1 answer
  • Which one of the following carrier types generally transports goods for the company that owns the carrier?
    11·1 answer
  • To make your business messages more effective, revise for vigor and directness. You can strengthen your writing by unburying ver
    12·1 answer
  • Which of the following statements is false?
    7·1 answer
  • The normal rate of return on equity capital is also known as
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!