Answer:
Hersey's bond = $1125.513
Mars bond = $1172.259
Explanation:
Hersey bond;
Period(t) = 10years = 40(quartely)
Coupon (C) = $30
Rate (r) = 0.1 = 0.025(quarterly)
Pay at maturity(p) = $1000
Using the both present value (PV) and compound interest formula ;
PV =[ C × (1 - (1+r)^-t) ÷ r] + [p ÷ (1 + r)^t]
PV = [30×(1-(1.025)^-40)÷0.025] + [1000÷(1.025)^40]
PV =( 753.083251562) + (372.4306236)
PV = $1125.513
Mars bond;
Period(t) = 20years = 80(quartely)
Coupon (C) = $30
Rate (r) = 0.1 = 0.025(quarterly)
Pay at maturity(p) = $1000
PV =[ C × (1 - (1+r)^-t) ÷ r] + [p ÷ (1 + r)^t]
PV = [30×(1-(1.025)^-80)÷0.025] + [1000÷(1.025)^80]
PV =(1033.55451663) + (138.704569467)
PV = $1172.259
Answer:
a. Is JV a variable interest entity (VIE)?
Yes, JV should be considered a variable interest entity. Basically both AutoCo and ElectricCo share JV's board, but ElectricCo didn't have the money to start a company or even be part of a joint venture. ElectricCo's equity is financed by AutoCo, so ElectricCo has basically no no equity at risk. Even the debt acquired by JV is backed by AutoCo, but AutoCo does not control JV on its own.
Basically ElectricCo's contribution is technology, and AutoCo provides everything else, but both control the company with one side (ElectricCo) not having enough money to invest but doing so through financing.
b. Which entity, if any, should consolidate JV?
AutoCo must include JV in its consolidated balance sheet since it owns 60% of the company and the products manufactured by JV are sold under AutoCo's brand.
B. Interest
Because the bank has to charge a certain amount for loaning out the money
Answer: Hello There!.................
It causes you to put yourself in the other person's shoes and gives you a new perspective. Contrast honest or dishonest with legal or illegal business practices. ... It keeps people from doing things that may be ethical to them but unethical to everyone else.
Explanation:
Mark me brainest please. Hope this helps. Anna ♥
