Answer:
Explanation:
b)
BBB-rated corporate bond:
Face value = 1000
semiannual coupon = 9%/2 = 4.5%
semiannual yield = 10%/2 = 5%
number of payments = 5*2 = 10
PV of bond = PV of maturity + PV of interest
PV of maturity = Face value * PVF(5%;10) = 1000*0.614=614
PV of interest = interest *PVIFA(5%;10) = 45*7.7217= 347.4765
Price of bond = 961.4765
a)
semiannual yield = 8.4%/2 = 4.2%
US treasury security:
PV of maturity = Face value * PVF(4.2%;10) = 1000*0.66271=662.71
PV of coupon = 45*8.03074 = 361.3833
Price of bond = 1024
c) credit spread = BBB yield - risk-free yield = 10% - 8.4% = 1.6%
Answer:
Commercial bank
Explanation:
A commercial bank accepts cash deposits from the general public and lends a portion of the money as loans to make profits. Commercial banks make profits by charging a high-interest rate on credit issued than the interest rate they offer on deposits. By accepting deposits and lending to other customers, commercial banks act as intermediaries between suppliers and users of credit.
Commercials are profit-making institutions. Although their primary function revolves around accepting deposits and issuing out loans, they also perform other duties such as;
- Discounting bills of exchange
- Overdraft facility
- Agency functions, including payment functions and insurance of letters of credit and checks.
- General utility services including foreign exchange transactions, underwriting securities, and safe deposits.
Answer:
Answer:I agree with this statement to a certain degree as air cannot be brought and sold it’s the only thing that can’t be taken physically from someone even if you are poor or don’t own much money u are a blé to breath without the need to think of expenses
Explanation:
Answer:
The correct answer to the following question is Tender offer .
Explanation:
Tender offer can be defined as an offer made by an acquirer ( who can be any individual purchaser or the company itself ) to purchase all or some number of shares from the stockholders shares in a company. Here the purchaser is offering a price that is premium to the market price. As per the SEC ( securities exchange commission ) any purchaser who is acquiring 5% or more percent of shares of the company has to inform SEC and exchange about it.