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2 years ago

A 16-year, $1,000 par value zero-coupon rate bond is to be issued to yield 6 percent.

Business

1 answer:

Solnce55 [7]2 years ago

7 0

Answer:

a) $393.65

b) $458.11

c) $217.63

Explanation:

Given data:

16-year ( n )

$1000 par value ( FV )

6% ( R )

A) determine the initial price of the bond

= FV / ( 1 + R ) ^ n

= 1000 / ( 1.06 ) ^ 16

= 1000 / 2.5403 = $393.65

B ) when interest rate drops to 5% determine the value of the zero-coupon rate of bond

= FV / ( 1 + R ) ^n

= 1000 / ( 1.05 ) ^ 16

= 1000 / 2.1829 = $458.11

C ) when interest rate increases to 10% determine the value of the zero-coupon rate of bond

= Fv / ( 1 + R ) ^ n

= 1000 / ( 1.1 ) ^ 16

= 1000 / 4.5950 = $217.63

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3 years ago

If Frica Morrison a machine operator at Stanley Foundry, makes $513.66 a week and has 33 in FIT withheld, how many allowances ha

exis [7]

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Given that :

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Therefore, the Number of allowances claimed by Frica Morrison is 3.

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1 year ago

Alvin is a self-employed sound technician who reports on the cash method and calendar year. Alvin has a shop in Austin, Texas, b

andrezito [222]

Answer:

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2 years ago

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Answer:

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2 years ago

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Journal entries to record depreciation expense

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Date Account titles and explanation Debit Credit

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Accumulated Depreciation $9,720

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