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sashaice [31]
2 years ago
14

Up in Smoke Tobacco Shops' bond carries a 9 percent coupon, pays interest semiannually, and has 10 years to maturity. What is th

e bond's yield to maturity if the bond is selling for $937.75 (rounded to the nearest whole percent)
Business
1 answer:
lara [203]2 years ago
6 0

Answer:

10%

Explanation:

Since the bond is selling at a discount, it means that the coupon rate is blow the market rate, so the actual rate must be higher. Since there is only one option with an interest rate above 9%, we must check to see if it works.

10% yearly interest rate = 5% semiannual interest rate

we must determine the PV of the 20 coupons paid and the face value at maturity.

to calculate the PV of the 20 coupons ($45 each) we can use an excel spreadsheet and the NPV function with a 5% discount rate: PV of the coupons = $560.80

the PV of the face value in 10 years = $1,000 / 1.05²⁰ = $376.89

the present value of the coupons and the bond at maturity = $560.80 + $376.89 = $937.69. The PV using a 5% semiannual rate is very similar to $937.75, and since the question asked us to round up to the nearest whole percent, we can assume it is correct.

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According to the website nationalbikeregistry, at the campus of UC Berkeley 12% of registered bicycles are stolen each year. Sup
yaroslaw [1]

Answer:

n = 160

p = 0.12

Explanation:

In a Binomial distribution two parameters are of great interest, n and p.

where n is the number of trials and p is the probability of success and (1 - p) is the probability of failure.

p = 12%

n = 160

Mean = E(X) = μ = n*p = 160*0.12 = 19.2

μ = 19.2

variance = σ² = np(1 - p) = 160*0.12(1 - 0.12) = 16.89

standard deviation = σ = √16.89 = 4.11

σ = 4.11

7 0
1 year ago
Joshua is paid the minimum hourly rate for his work as a lifeguard. joshua's compensation is called a ________.
Lynna [10]

Joshua’s compensation in which he is paid with the minimum hourly rate for his work as a life guard is called salary. A salary is being given to an employee in which the annual sum in their job are fixed and that they have a specified amount to the job description given.

3 0
1 year ago
Bypassing regular sales channels in favor of Internet retailing can have strong appeal if it A. D) includes partnering rather th
jolli1 [7]

Answer:

Option A.

Includes partnering rather than competing with existing distributors

Explanation:

Through internet retailing, a business can partner with other distributors and enlist the products of the distributors on their website along side their products.They can charge a fee for each product sold via their platform, which can serve as additional revenue to the business, without much extra costs. This is because the platform is already available.

This is the business model that companies such as Amazon apply. They enlist products of other businesses on their online platform, sell them and make some profit for themselves.

This is what gives internet retailing a strong appeal.

5 0
2 years ago
A property title search firm is contemplating using online software to increase its search productivity. Currently an average of
Korolek [52]

Answer:

Current = 5.00

Company A = 6.30

Company B = 6.71

The company B would have the highest productivity in terms of revenue per dollar of input, that is 6.71.

Explanation:

Current:

Average time = 40 minutes

Cost = 40 minutes x $2 = $80

Productivity (Revenue per $ input) = $400 / $80 = 5.00

Company A:

Average time = 40 - 10 = 30 minutes

Cost = (30 minutes x $2) + $3.50 = $60 + $3.50 = $63.50

Productivity (Revenue per $ input) = $400 / $63.50 = 6.30

Company B:

Average time = 40 - 12 = 28 minutes

Cost = (28 minutes x $2) + $3.60 = $56 + $3.60 = $59.60

Productivity (Revenue per $ input) = $400 / $59.60 = 6.71

Current = 5.00

Company A = 6.30

Company B = 6.71

The company B would have the highest productivity in terms of revenue per dollar of input, that is 6.71.

Hope this helps!

7 0
1 year ago
A business issued a 120-day, 5% note for $60,000 to a creditor on account. Journalize the entries to record (a) the issuance of
Lyrx [107]

Answer:

cash                         60,000 debit

  note payable        60,000 credit

--to record issuance--

interest expense       1,000 debit

Amortizacion Land 34,000 debi

---to reocrd sale of receiptst

Explanation:

Interest payment:

principal x rate x time (being time and rate expressed in protion of a year

60,000 x 0.05 x 120/360 = 1,000

4 0
2 years ago
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