1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
maksim [4K]
3 years ago
8

emiannual coupon bonds with the same risk (Aaa) and maturity (20 years) as your company's bonds have a nominal (not EAR) yield t

o maturity of 9%. Your company's treasurer is thinking of issuing, at par, some $1,000 par value, 20-year, quarterly payment bonds. She has asked you to determine what quarterly interest payment, in dollars, the company would have to set in order to provide the same effective annual rate (EAR) as those on the 20-year, semiannual payment bonds. What would the quarterly, dollar interest payment be
Business
1 answer:
garri49 [273]3 years ago
4 0

Answer:

quarterly coupon payment = $22.25

Explanation:

effective annual interest rate of current bonds = (1 + 9%/2)² - 1 = 9.2025%

if the new bonds will have quarterly payments, then the nominal interest rate should be:

1.092025 = (1 + r/4)⁴

⁴√1.092025 = ⁴√(1 + r/4)⁴

1.02225 = 1 + r/4

0.02225 = r/4

r = 8.9% annual

quarterly rate = 2.225%

quarterly coupon payment = $22.25

You might be interested in
A 60-day, 9% note for $10,000, dated May 1, is received from a customer on account. The maturity value of the note is Select one
Andreas93 [3]
I would say $10,150. The 10,000 principal x 1.09 = 10,900 but this would be for 9% for one year whereas the term is 60 days or approx. 2 months or 1/6 of a year so the increase would be 900/6 = 150 so the total value would be $10,150.
6 0
3 years ago
During the current year, Cary and Bill incurred acquisition debt on their residence of $1,300,000 and a home equity loan of $200
77julia77 [94]

Answer:

qualified acquisition debt = $750,000

qualified home equity debt = $0

Explanation:

Qualified acquisition debt refers to the debt incurred to purchase or build your home. In this case, Cary and Bill are allowed to itemize the interests paid for up to $750,000 of the acquisition debt ($375,000 if filing separately). This limit was reduced due to the TCJA of 2017, and will remain in place until 2025. After 2025, the limit will return to the normal $1,000,000.

Certain amount of interests on qualified home equity loans will also return in 2025, but currently they are not deductible.  

8 0
4 years ago
Tony works as a salesperson at Franklin Delights, a company that specializes in labor-saving kitchen appliances. When Tony gives
klasskru [66]

Answer: adaptive selling

                           

Explanation: In simple words, adaptive selling refers to the ability under which an employee changes his or her behavior with the change in the status of the clients.

Under such style of selling, the salesman performing highly focus on the type of customer, the situation in which sales is made and the feedback received and tailors his or her approach to sales accordingly.

In the given case, Tony is stating different facts regarding the product for different customers. Hence we can conclude that he is doing adaptive selling.

7 0
4 years ago
Jesse works for a canning factory that creates soda cans for distribution. his job is to move identically filled boxes from the
BigorU [14]

The correct answer is mass production. Mass production is being defined as having to manufacture products in large quantities by which they are likely utilized by an assembly of line technology. This is a process by which it creates similar products in large numbers.

3 0
3 years ago
the directors want to give R500 000 to a local school.Give Two reasons why companies take such decision.​
sdas [7]

Answer:

To make investments that will grow over time and provide education for less fortunate children

To have a good public image so they can get more customers.

5 0
3 years ago
Other questions:
  • The following account titles were drawn from the general ledger of Holt Food Supplies, Incorporated (HFSI): Computers, Operating
    5·2 answers
  • Gerald orders 1,000 cupcakes from Haddock Bakers for a Christmas Eve party. However, Haddock fails to deliver the cupcakes as pe
    15·1 answer
  • The income statement of Sunland Company for the month of July shows net income of $2,760 based on Service Revenue $7,160, Salari
    14·1 answer
  • Today, most union members work as Select one:
    11·1 answer
  • You may use your financial calculator or present value tables for this question. Firm A leased equipment with a list price $1,21
    10·1 answer
  • When a firm tries to encourage consumers directly to purchase a particular product or service by offering some sort of special i
    6·1 answer
  • Two activists were sued by McDonald’s for handing out leaflets accusing the company of paying low wages, cruelty to animals used
    12·1 answer
  • Mark writes a check to Sally, intending to use it to pay Sally for babysitting Mark's daughter next week. Sally arrives at Mark'
    15·1 answer
  • Why should firms manage thier environment
    9·1 answer
  • on january 1 of year 1, congo express airways issued $3,400,000 of 7% bonds that pay interest semiannually on january 1 and july
    15·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!