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VashaNatasha [74]
4 years ago
12

You are trying to price two bonds that have the same maturity and par value but different coupon rates. Both bonds mature in 8 y

ears and at maturity both bonds return the par value of $1,000. One bond has a coupon rate of 4% and a yield to maturity of 4%. The other bond has a coupon rate of 5% and a yield to maturity of 4%. What is the absolute value of the difference between the prices of these two bonds
Business
1 answer:
hjlf4 years ago
3 0
The answer would be 71% !
hope this helps !
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Assembly or production of finished products, producing the right amount of product, and ensuring that finished products meet spe
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Manufacturing

Explanation:

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For a project with cash outflows during its life, the least preferred capital budgeting tool would be: A. internal rate of retur
Mashcka [7]

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A. internal rate of return.

Explanation:

Net present value method: In this method, the initial investment is deducted from the cash inflows of the discounted present value. If the sum comes under positive than the project would otherwise not be beneficial to the company.

The internal rate of return is that return in which the net present value is zero, meaning that the initial investment is equal to the present value of the annual cash flows after taking into account the discount factor

Moreover, the IRR could be in multiples also i.e multiple IRR.

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4 years ago
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Dvinal [7]
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5 0
3 years ago
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A savings account that pays interest every month is said to have a _______ interest period.
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A savings account that pays interest every month is said to have a quarterly interest period.
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3 years ago
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16. GDP Growth Consider the following data on U.S. GDP: Year GDP (Billions of current dollars) (Billions of 2009 dollars) 2011 1
dmitriy555 [2]

Answer:

The percentage change in nominal GDP from 2013 to 2014 was 4.29%

The percentage change in real GDP from 2012 to 2013 was 1.48%

The percentage change in real GDP from 2012 to 2013 was higher than the percentage change in real GDP from 2011 to 2012. FALSE

Explanation:

In order to calculate this we just have to calculate the percentages with a rule of thirds:

\frac{GDP1}{100}= \frac{GDP2}{x}

To calculate the first one we use the nominal GDP which is the GDP with the current market value:

\frac{GDP1}{100}= \frac{GDP2}{x}\\\frac{16,663.2}{100}= \frac{17,348.1 }{x}\\x=\frac{(100)(17,348.1}{16,663.2} \\x=4.29%

To calculate the change in real GDP we use the values adapted to a pre-agreed monetary value, in this case the dollar at 2009:

\frac{GDP1}{100}= \frac{GDP2}{x}\\\frac{15,354.6}{100}= \frac{15,583.3}{x}\\x=\frac{(100)(15,583.3}{15,354.6} \\x=1.48%

To calculate the 2011 to 2012 we insert the values:

\frac{GDP1}{100}= \frac{GDP2}{x}\\\frac{ 15,020.6}{100}= \frac{15,354.6}{x}\\x=\frac{(100)(15,354.6}{ 15,020.6} \\x=2.22%

So with this we know that it is wasn´t higher the percentage change from 2012-2013, than that of 2011-2012

5 0
3 years ago
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