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
Usimov [2.4K]
3 years ago
13

Compute the modified duration of a 9% coupon, 3-year corporate bond with a yield to maturity of 12%.

Business
1 answer:
iragen [17]3 years ago
6 0

Answer:

C. 2.45

Explanation:

Pv of cash flow

1000x9%/(1+0.12)

= 90/1.12

= 80.36

Weight = 1

Weighted pv of cash flow = 80.36

Pv of cash flow

= 1000x9%/(1+0.12)²

= 90/1.2544

= 71.75

Weight = 2

Weighted pv of cash flow = 71.75x2

= 143.5

Pv of cash flow

= (1000+1000*9%)/(1+0.12)³

= 1090/1.404928

= 775.84

Weight = 3

Weighted pv of cash flow

= 775.84x3

= 2327.52

Total pv of cash flow = 80.36+71.75+775.84

= 927.95

Total weight of cash flow pv =

80.36+143.5+2327.52

= 2551.38

Duration = weighted pv/pv

= 2551.38/927.95

= 2.75

Modified duration =

Duration/1+0.12

= 2.75/1.12

= 2.45

You might be interested in
In deciding who should chair the wellness committee, several members identified Ian, a tall, handsome 40-ish staff accountant wi
lina2011 [118]

Answer:

a. Traits approach

Explanation:

It is correct to state that the committee members were operating under the leadership traits approach, which corresponds to the collective perception of an individual's personality through their personal characteristics that are outstanding and that make them stand out among other individuals.

As in the case of Ian, who was perceived by many members as a person with a lively sense of humor, as someone who would do a good job.

7 0
3 years ago
What is considered a liability in finance and why is it being used?
garri49 [273]

A liability is something a person or company owes, usually a sum of money. ... In the world of accounting, a financial liability is also an obligation but is more defined by previous business transactions, events, sales, exchange of assets or services, or anything that would provide economic benefit at a later date

8 0
3 years ago
Read 2 more answers
Which option best describes the main behavior that economics studies?
lina2011 [118]

Answer:

A. People creating different governments around the world

Explanation:

economics looks at how the world’s resources are used by and distributed among individuals and organizations.

5 0
3 years ago
What are two resources that may be useful in disassembling a laptop computer?
PilotLPTM [1.2K]

The user manual and the service manual are two resources that are useful in terms of disassembling the laptop computer. It is because the service manual and the user manual were able to provide instructions and specifications for repairing or being able to maintain the laptop and the way of providing a manual in having to assist a person in technical issues and use.

<span> </span>

7 0
3 years ago
how a teacher can use motivational strategies to control problem behavior in classroom give an example
noname [10]
<h3><u>Answer</u></h3>

The Earth’s mantle is made up of Tectonic plates that are forever moving as the Earth cools down. This happens over billions of years, and one of the most notable ones is around the Pacific rim where Earthquakes, (seismic activity) happens quite often

The Rift Valley in Ethiopia lies along the edge of the African Tectonic Plate, and continues down through parts of Somalia and into Kenya.

Just recently a rift opened up in Kenya, which seismologists seem to think is the pre-cursor of a major tectonic plate movement, splitting apart a part of Africa, which could include Ethiopia

Here are some strategies that can be used in the classroom to help motivate students:

  • Promote growth mindset over fixed mindset.
  • Develop meaningful and respectful relationships with your students.
  • Grow a community of learners in your classroom.
  • Establish high expectations and establish clear goals.
  • Be inspirational.
5 0
2 years ago
Other questions:
  • An agreement to settle a debt for less than the sum claimed is referred to as?
    9·1 answer
  • Dora’s company manufactures chocolate. They started off with manufacturing all kinds of chocolate, and now they want to expand i
    13·1 answer
  • Logistics Trucking Company operates a fleet of fuel trucks. When one of the trucks is positioned to receive a load of biofuel, i
    14·1 answer
  • Rosa has a 10% chance of getting sick in the next year. If she gets sick, her medical bills will amount to $500. She has a wealt
    14·1 answer
  • Your car still has a marginal cost of $20,000. But, the market price has now increased to $25,000. Your incentive to supply cars
    11·2 answers
  • First question, please help. My teacher is super mad rn, need to finish dis.
    10·1 answer
  • Revenue is traditionally recognized in the accounting records when A. Cash is received. B. Services are rendered. C. It's incurr
    12·1 answer
  • Which of the following is a health hazard an insulation worker is likely to encounter on the job?
    8·2 answers
  • When incorporating a business, which one of the following is not a major step to take?
    9·1 answer
  • Ownership is held in ________ when all the rights of ownership in a particular piece of property are held by one person
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!