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uysha [10]
3 years ago
6

Moon lite cafe has a semiannual, 5 percent coupon bond with a current market price of $988.52. the bond has a par value of $1,00

0 and a yield to maturity of 5.68%. how many years is it until this bond matures?
Business
1 answer:
Ivenika [448]3 years ago
5 0
Mostly 18 years is it until the bond matures.Given; Semiannually, 5 percent coupon bond, market price = $988.52Solution; $988.52 = [(.05 / 2) × $1,000] × [(1 - {1 / [1 + (.0568 / 2)]t × 2}) / (.0568 / 2)] + $1,000 / [1 + (.0568 / 2)]t × 2; t = 3.6 semi-annual periods, or 1.8 years
The answer in this question is 18 years.
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Answer:

(D) earned capital

Explanation:

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8 0
3 years ago
A company issues a callable (at par) ten-year, 6% coupon bond with annual coupon payments. The bond can be called at par in one
g100num [7]

Answer:

B) 1.92%

Explanation:

For computing the yield to maturity we need to apply the RATE formula i.e to be shown in the attachment

Given that,  

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PMT = $100 × 6% = $6

NPER = 1

The formula is shown below:  

= Rate(NPER;PMT;-PV;FV;type)  

The present value come in negative        

After applying the above formula, the yield to maturity is 1.92%  

7 0
3 years ago
The inflation rate over the past year was 3.8 percent. If an investment had a real return of 6.9 percent, what was the nominal r
Natalka [10]

Answer:

Nominal rate of return= 10.96%

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<em>Real interest rate is the amount of interest in terms of the the quantity of good and services that can be purchased. It is the nominal interest rate adjusted for inflation. </em>

The relationship between inflation, real interest and nominal interest rate is given using the Fishers Effect;

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Nominal rate of return =(1.038)× (1.069) - 1 = 0.109622

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6 0
3 years ago
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7 0
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aalyn [17]

Answer:

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