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77julia77 [94]
2 years ago
11

Use the information for the​ question(s) below. The Sisyphean Company has a bond outstanding with a face value of​ $1000 that re

aches maturity in 15 years. The bond certificate indicates that the stated coupon rate for this bond is​ 8% and that the coupon payments are to be made semiannually. Assuming the appropriate YTM on the Sisyphean bond is​ 7.5%, then the price that this bond trades for will be closest​ to:
Business
2 answers:
liraira [26]2 years ago
6 0

Answer:

$1,044.57

Explanation:

Price of the bond is the present value of all cash flows of the bond. These cash flows include the coupon payment and the maturity payment of the bond. We calculate the present value of both the coupon payment and the maturity payment.

According to given data

Face value of the bond is $1,000

Coupon payment = C = $1,000 x 8% = $80 annually = $40 semiannually

Number of periods = n = 15 years x 2 = 30 period

YTM =  7.5% annually = 3.75% semiannually

Price of the bond is calculated by following formula:

Price of the Bond = C x [ ( 1 - ( 1 + r )^-n ) / r ] + [ F / ( 1 + r )^n ]

Price of the Bond = $40 x [ ( 1 - ( 1 + 3.75% )^-30 ) / 3.75% ] + [ $1,000 / ( 1 + 3.75% )^30 ]

Price of the Bond = $713.17 + $331.40 = $1,044.57

yulyashka [42]2 years ago
6 0

Answer:

The price of the bond will be closest $1,0445

Explanation:

Face value $1000, years to maturity 15 years , coupon rate 8% paid semi annually, YTM 80%

Semiannual

n = 15*2 = 30

coupon payments = 8%*1000/2 = $40

YTM = 7.5%/2 = 3.75%

Value of a bond is equal the present value of coupon payments and present value of face value at maturity

Bond Price = C* [1-(1+r)^-n/r] + FV/ (1+r)^n

                  = 40 * [1-(1+0.375)^-30/0.0375] + 1000/(1+0.0375)^30

                  =713.1698 +331.4033

                  = $1,044.57

     Therefore when rounding of the price of this bond is closest to $1,0445          

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Answer:

$34.8

Explanation:

Profits = sales - costs( variable costs +fixed costs)

In this case : total sales will be price $0.75 x units sold X= 0.75X

Variable costs : =$10 x units sold= $10x

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profits for the Week

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P= $69 - $9.2- $25

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2 years ago
You can now sell 70 cars per month at $35,000 per car, and demand is increasing at a rate of 4 cars per month each month. What i
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Answer:

the fastest we could drop your price before your monthly revenue starts to drop is $2,000

Explanation:

Data provided in the question:

Cars sold per month, Q =  70 cars

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Rate of increase in demand, \frac{dQ}{dt} = 4 cars per month

Now,

Revenue, R = Price(P) × Quantity (Q)

Thus,

When monthly revenue starts to drop i.e \frac{dR}{dt} < 0

⇒ \frac{dR}{dt} = \frac{d(PQ)}{dt} < 0

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⇒ 70\times\frac{dP}{dt}+35,000\times4 < 0

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\frac{dP}{dt} < - 2,000

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the fastest we could drop your price before your monthly revenue starts to drop is $2,000

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You and two partners start a company. However, your partners play no role in running the company. You spend all your time managi
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Answer:

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Opportunity cost is described as the return of the choice selected over the potential return that could have been obtained from the choice left  behind. It represents the return of the option chosen compared to the choice forgone. Opportunity costs is also defined as the return of the best next available option.

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Answer:

TV (television)

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The higher the number of times a user is exposed to an advert in a given time frame the higher the advertising frequency.

Normally it take exposure of 5 times and above for an advertisement to be effective.

Bill’s Surf Shop will have more advertising frequency on television because all categories of customers watch the television. Including children, teenagers, middle aged, and older people.

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Television gives a larger audience.

3 0
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