Issues zero coupon bonds on market-what is yield to call

Assignment Help Financial Management
Reference no: EM13883208

Atlantis Fisheries issues zero coupon bonds on the market at a price of $501 per bond. These are callable in 10 years at a call price of $560. Using semi annual compounding, what is the yield to call for these bonds? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Omit the "%" sign in your response.)

Reference no: EM13883208

Questions Cloud

Depreciated straight-line to zero over their lives : Lang Industrial Systems Company (LISC) is trying to decide between two different conveyor belt systems. System A costs $244,000, has a four-year life, and requires $76,000 in pretax annual operating costs. System B costs $342,000, has a six-year life..
What level of pretax cost savings : Your firm is contemplating the purchase of a new $575,000 computer-based order entry system. The system will be depreciated straight-line to zero over its five-year life. It will be worth $59,000 at the end of that time. At what level of pretax cost ..
Role of parties in plurality-proportional election systems : How do political parties shape election outcomes and the formation of governments? Discuss the similarities and differences in the role of political parties in presidential and parliamentary governments, and discuss the role of parties in plurality a..
Deferred tax liability-capital gains offer over dividends : Goodwin Technologies, a relatively new company, has been wildly successful but has yet to pay a dividend. An analyst forecasts that Goodwin is likely to pay its first dividend three years from now. "Investors prefer the deferred tax liability that ca..
Issues zero coupon bonds on market-what is yield to call : Atlantis Fisheries issues zero coupon bonds on the market at a price of $501 per bond. These are callable in 10 years at a call price of $560. Using semi annual compounding, what is the yield to call for these bonds?
Management contract with its newly hired president : The Great Giant Corp. has a management contract with its newly hired president. The contract requires a lump sum payment of $25,100,000 be paid to the president upon the completion of her first 7 years of service. The company wants to set aside an eq..
The stock has a required rate of return : What is the value today of a stock that will pay a dividend of $4.10 one year from now, a $4.70 dividend in year two and a dividend of $5 three years from now if its expected price in year three is $35? The stock has a required rate of return of 11%.
Average dollar of sales brings : Assume that opening up the Souvenir Shop costs Road Atlanta $800, that the average dollar of sales brings in 55 cents of margin, and that only 25% of spectators buy anything. If a spectator does buy something, let’s guess that he or she will spend ar..
Ignore any tax loss carry back or carry forward provisions : During the year, Belyk Paving Co. had sales of $2,392,000. Cost of goods sold, administrative and selling expenses, and depreciation expense were $1,433,000, $435,800, and $490,800, respectively. In addition, the company had an interest expense of $2..

Reviews

Write a Review

 

Financial Management Questions & Answers

  What is the firms current price per bond

Endicott Enterprises Inc. has issued 30-year semiannual coupon bonds with a face value of $1,000. If the annual coupon rate is 14% and the current yield to maturity is 15%, what is the firm's current price per bond?

  Effective interest rate

Effective interest rate. You borrow $55,000; the annual loan payments are $3,180.66 for 30 years. What interest rate are you being charged?

  What is the expected capital gains yield-current yield

Bond P is a premium bond with a 12 percent coupon. Bond D is a 6 percent coupon bond currently selling at a discount. Both bonds make annual payments, have a YTM of 9 percent, and have five years to maturity. Assume these bonds have a face value of $..

  Define the importance of time value of money

Define the importance of time value of money including compounding (future value), discounting (present value) and annuities. Why do organization leaders need to understand these concepts?

  How much net operating profit after taxes does the firm

Faisal Ahmed Enterprises has the following income statement. How much net operating profit after taxes (NOPAT) does the firm have?

  What is the bond equivalent yield

A U.S. Treasury bill with 104 days to maturity is quoted at a discount yield of 1.70 percent. What is the bond equivalent yield?

  What is the current price for berkshire hathaway stock

What is the current price for Berkshire Hathaway stock, class A. What kind of signal do you think it sends? Has the class A stock has ever had a stock split?

  Initial outlay-what is the net present value of the project

A project has an initial outlay of $1,964. It has a single payoff at the end of year 7 of $6,219. What is the net present value (NPV) of the project if the company’s cost of capital is 10.89 percent?

  Determine the yield to maturity for this bond

The coupon rate and market price for the 10-year US Treasury bond are 2.50% and 96.3828 respectively. Note, the price is expressed as a percentage of par (like other bonds). If par is $1000, then this bond is selling for $963.828. Assume that this bo..

  Calculate weighted average cost of capital for stone corp

Given an optimal capital structure that is 50% debt and 50% common stock, calculate the weighted average cost of capital for stone corp.

  Individual retirement account with maximum contribution

Mary plans to fund her individual retirement account (IRA) with the maximum contribution of $2,500 at the end of each year for the next 25 years. If Mary can earn 9 percent on her contributions, how much will she have at the end of the twenty-fifth y..

  What is the value ofthe stock if the required rate of return

A stock just paid an annual dividend of $2. The dividends are expected to grow at 20%per year over each of the next three years and 5% per year thereafter. What is the value ofthe stock if the required rate of return is 12%?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd