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dedylja [7]
2 years ago
14

A bond with 15 detachable warrants has just been offered for sale at $1,000.00 . The bond matures in 25 years and pays a semi-an

nual coupon of $50 ($25.00 each six months). Each warrant gives the owner the right to purchase two shares of stock in the company at $45.00 per share. Ordinary bonds (with no warrants) of similar quality are priced to yield 7.00 percent. What is the value of one warrant
Business
1 answer:
ad-work [718]2 years ago
6 0

Answer:

$15.64

Explanation:

first we must determine the market value of the bond without the warrants:

PV of face value = $1,000 / (1 + 3.5%)⁵⁰ = $179.05

PV of coupon payments = $25 x 23.45562 (PV annuity factor, 3.5%, 50 periods) = $586.39

market value = $765.44

the market value of the 15 warrants = $1,000 - $765.44 = $234.56

market value per warrant = $234.56 / 15 = $15.64

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List three conditions for perfect competition.Instructions: You may select more than one answer.1. There is only one firm that m
Jobisdone [24]

Answer:

There are no barriers to entry.

5. Both buyers and sellers are price takers

.7. Firms’ products are identical.

Explanation:

A perfect competition is characterised by many buyers and sellers of homogenous goods and services. Market prices are set by the forces of demand and supply. There are no barriers to entry or exit of firms into the industry.

In the long run, firms earn zero economic profit. If in the short run firms are earning economic profit, in the long run firms would enter into the industry. This would drive economic profit to zero.

Also, if in the short run, firms are earning economic loss, in the long run, firms would exit the industry until economic profit falls to zero.

A monopoly is when there's only one firm operating in an industry.

I hope my answer helps you

6 0
2 years ago
Read 2 more answers
Which of the following are the fixed costs relative to the number of the units produced and sold? a. straight-line depreciation,
ollegr [7]

Answer:

The correct answers are letters "A", "B", and "C": straight-line depreciation, manager's salary, store rent.

Explanation:

Fixed Costs are business expenses that do not change as the level of production goes up or down. They are one of two types of business expenses the other being variable cost. Variable costs do change as the volume of production changes. Examples of fixed costs are high-executive salaries, rent, depreciation, and insurance. Examples of variables costs are commissions, raw materials, and transportation fees.

7 0
3 years ago
Which of the following is the basis for Justice Ginsberg's opinion that Guido and
ira [324]

Answer:2. Which of the following is the basis for Justice Ginsberg's opinion that Guido and Rankin have legitimate grounds for a lawsuit? The district is a public employer, making its size irrelevant. ... The district has already been sued for the same issue by other former employees.

Explanation:

8 0
2 years ago
For each of the items indicate whether its amount affects the bank or book side of a bank reconciliation and is an addition or a
gulaghasi [49]

Answer:

The correct answer is:

a)  Unrecorded deposits : bank addition

b)  Interest on cash balance : book addition

c) Bank service charges : book subtraction

d) Debit memos : book subtraction

e) Outstanding Checks : bank subraction

f)  Credit memos : book addition

g) NSF checks : book subtraction

Do unrecorded deposits require an adjusting journal entry?  No

Does interest on cash balance require an adjusting journal entry?  Yes

Do bank service charges require an adjusting journal entry?  Yes

Do debit memos require an adjusting journal entry?  Yes

Do outstanding checks require an adjusting journal entry?  No

Do credit memos require an adjusting journal entry?  Yes

Do NSF checks require an adjusting journal entry?  Yes

8 0
3 years ago
Read 2 more answers
Bob and Serena are married and file a joint income tax return. For 2018, their modified AGI is $70,000. Their daughter, Dawn, is
Bogdan [553]

Answer:

The American Opportunity Tax Credit (AOTC) that can be claimed is $2,500.

Explanation:

As of 2018, no changes have been made to the AOTC. By law, with a modified  adjusted gross income (MAGI) of $80,000 or less for single individuals and $160,000 or less for married filing jointly, the individuals can claim the full credit amount. It is a credit paid for an eligible student to cover education expenses, if in the first four years of postsecondary education. A maximum annual amount of $2,500 is given and an additional 40% of remaining amount (up to $1,000) if the tax owed falls to zero.

8 0
3 years ago
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