Andrew Carnegie's system of vertical integration a combined all facets of an industry, from raw material to final product, withi
1 answer:
You might be interested in
Answer:
a) 7% as their market price will adjsut to give the same yield as the market
b) bond P = -10.17
bonds D = 10.07
Explanation:
we have to calcualte the price variation of the bonds from now (10 years to maturity) to next year (9 years)
Bond P
C 90.000
time 10
rate 0.07
PV $632.1223
Maturity 1,000.00
time 10.00
rate 0.07
PV 508.35
PV c $632.1223
PV m $508.3493
Total $1,140.4716
then, at time = 9
C 90.000
time 9
rate 0.07
PV $586.3709
Maturity 1,000.00
time 9.00
rate 0.07
PV 543.93
PV c $586.3709
PV m $543.9337
Total $1,130.3046
Capital loss: 1,130.30 - 1,140.47 = -10.17
We repeat the process for bond D
C 50.000
time 10
rate 0.07
PV $351.1791
Maturity 1,000.00
time 10.00
rate 0.07
PV 508.35
PV c $351.1791
PV m $508.3493
Total $859.5284
C 50.000
time 9
rate 0.07
PV $325.7616
Maturity 1,000.00
time 9.00
rate 0.07
PV 543.93
PV c $325.7616
PV m $543.9337
Total $869.6954
Capital gain: 869.70 - 859.53 = 10.07
Answer:
28.85
Explanation
Keanu has decided to save a fixed amount of 70,000 for a given period. We would need to calculate the number of years to achieve 7,796,223 using the FVIFA formula (Future value interest for an annuity)
Fixed payment× FVIFA=Future value
<em>FVIFA</em> =
where r is the periodic rate (9%)
and n is the number of periods
therefore; 70000×=7796223
=(7796223×0.09)/70000
n=27.85
However, since Keanu will not invest until the end of the first year, he will spend 28.85 years to achieve his goal