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cluponka [151]
2 years ago
12

There are zero coupon bonds outstanding that have a YTM of 6.09 percent and mature in 17 years. The bonds have a par value of $1

0,000. If we assume semiannual compounding, what is the price of the bonds?
Business
1 answer:
dlinn [17]2 years ago
6 0

Answer:

$3,606.49

Explanation:

the price of a zero coupon bond = maturity value / (1 + i)ⁿ

  • maturity value = $10,000
  • i = 6.09% / 2 = 3.045% semiannual interest rate
  • n = 17 years x 2 semiannual compounding = 34 periods

the price of a zero coupon bond = $10,000 / (1 + 3.045%)³⁴ = $10,000 / 1.03045³⁴ = $10,000 / 2.772779928 = $3,606.49

the formula we used to determine the market price of a zero coupon bond is basically the present value

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Halverstein Company's outstanding stock consists of 8,050 shares of cumulative 5% preferred stock with a $10 par value and 3,450
Licemer1 [7]

Answer:

$6,900 to preference shareholders

Explanation:

The computation of the amount of dividends paid to preferred and common shareholders in Year 2 is shown below:

The Preference dividend is

= 8,050 shares × $10 × 5%

= $4,025

And, since the preference dividend is cumulative plus the in year 1 there is no dividend paid and in year 2 the dividend amount given is $6,900

But the total value is

= $4,025 + $4,025

= $8,050

So the total amount i.e $6,900 is paid to preferred shareholders only

3 0
2 years ago
Patricia Nall was approved for a $3,000, two-year, 11 percent loan with the finance charges figured using the discount method. H
Luba_88 [7]

Answer:

$2,340

Explanation:

The computation of cash received from this loan is shown below:-

cash received from this loan = Approved amount - (Approved amount × Two year × Percentage of loan )

= Approved amount - ($3,000 × 2 × 11% )

= $3,000 - ($3,000 × 2 × 0.11 )

= $3,000 - $660

= $2,340

Therefore, for computing the cash will Patricia receive from this loan we simply applied the above formula.

4 0
2 years ago
The key characteristic of organizational culture that addresses the degree to which people exhibit integrity and high ethical st
attashe74 [19]

Answer:

Integrity

Explanation:

Organizational culture consists of shared assumptions, values, and beliefs, which governs how people behave in organizations. These values determines how people behave in an organizational settings and there are different characteristics ranging from innovation, teamwork, stability etc. The main one that addresses degree people exhibit integrity and high ethical standards is Integrity.

8 0
2 years ago
The turnout for a game is expected to reach 70,000 fans, of which 60 percent are expected to drive. an average of 2 fans come in
vladimir1956 [14]
First, calculate for the number of fans that would come to the event in their own vehicle. This is calculated by multiplying the number of fans by the percentage.
    N = (70,000 fans)(0.60) = 42000
The number of vehicles is calculated by dividing the answer obtained above by 2.
   n = (42000) / 2 = 21000

The number of vehicles in the satellite parking is the difference of 21000 and 9000 which gives us an answer of 12000. Since each satellite parking will accommodate 1500, dividing 12000 by 1500 is 8.

ANSWER: 8 satellite parkings
4 0
2 years ago
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Suppose that there are two cities that are alike in every way except that one city has significantly better weather than the oth
Lelechka [254]

Answer:

bad weather

good weather

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Explanation:

8 0
2 years ago
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