Minimum selling price for the bond

Assignment Help Business Economics
Reference no: EM13735289

You have just purchased a municipal bond with a $10,000 par value for $9,500. You purchased it immediately after the previous owner received a semi-annual interest payment. The bond rate is 6.6% per year payable semi-annually. You plan to hold the bond for 6 years, selling the bond immediately after you receive the interest payment. If your desired nominal yield is 10% per year compounded semi-annually, what will be your minimum selling price for the bond?

Reference no: EM13735289

Questions Cloud

Describe the concept of opportunity cost with example : Describe the concept of opportunity cost with example. What would be your opportunity cost of taking on-line classes to get a degree at your University as compared to taking classes at traditional day schools at your University?
In the market for widgets two firms sell identical products : In the market for widgets, two firms sell identical products, compete by choosing the price at which they sell their product, and choose their prices at the same time. What will the equilibrium price and quantity be relative to what would occur if th..
Repay the loan by making equal monthly payments : You borrow $25,000 from your local credit union at 12 percent compounded monthly. You repay the loan by making equal monthly payments over the next four years. How much interest is in the 23rd payment?
What quantity will they produce-what price will they charge : Two firms, A and B, each with a marginal cost of $50, form an oligopoly whose market demand is P = 650 ? 10Q. If the market is defined by Cournot competition, what quantity will they produce and what price will they charge?
Minimum selling price for the bond : You have just purchased a municipal bond with a $10,000 par value for $9,500. You purchased it immediately after the previous owner received a semi-annual interest payment. The bond rate is 6.6% per year payable semi-annually. You plan to hold the bo..
The steepness of an indifference curve indicates : The steepness (slope) of an indifference curve indicates which of the following?
Quantified the relationship between the price of products : A large company in the communication and publishing industry has quantified the relationship between the price of one of its products and the demand for this product as Price = 150- 0.01 x Demand for an annual printing of this particular product.
Shooting for an early retirement : You take your first job out of college as an engineer with a salary of $58,000 per year. You decide to contribute $2,000 into your 401K retirement plan at the end of your first year (when you are 22 years old). If you continue to contribute annually,..
Calculate the horizontal deflection of joint d : A truss is shown in the figure below. Calculate the horizontal deflection of joint D produced by both the load and fabrication error

Reviews

Write a Review

 

Business Economics Questions & Answers

  Q1 demonstrate graphically the cost of income taxation of

q1. demonstrate graphically the cost of income taxation of 30 to consumers and producers for an income of

  Compute the arc price elasticity of demand for the price

Compute the arc price elasticity of demand for the price of paperback books falling from $7.00 to $6.50, the quantity demanded rises from 100 to 150.

  Demand curve is much more inelastic

If the demand curve is much more inelastic than the supply curve, clarify whether buyers or sellers will shoulder more of the tax burden from a new tax placed on the sellers.

  Considering either a tradable emission permit system

Suppose the authorities are considering either a tradable emission permit system, in which they give half the permits to each firm, or a tax system. If both systems work perfectly, how much will the firms have to pay, in total, for pollution reductio..

  After-tax real interest rate

If there was a capital gain tax of 30 percent, what is the after-tax real interest rate, with the inflation rate of 8 percent.

  Question about opportunity cost

If Robinson Crusoe can, either shoot 5-wild geese or catch 15-fish, on average, for every hour of labour effort. i.e. opportunity cost of shooting one wild goose is three fish.

  Illustrate what weakness does this measure have

Illustrate what are the arguments for using real per capita GNI to compare living standards between countries. What weakness does this measure have.

  Distribution of innate ability is distributed symmetrically

Suppose the distribution of innate ability is distributed symmetrically throughout a population but which the wage distribution is positively skewed.

  What would the fed big stick be

To prevent inflation,the Fed should follow Teddy Roosevelt's advice: 'Speak softly and carry a big stick.'" What would the Fed's "big stick" be? What is the statement trying to say?

  Why is the burden of a tax to taxpayers greater than

Why is the burden of a tax to taxpayers greater than the revenue recieved by the government. Why do some economists advocate taxing consumption rather than income.

  Elasticity of demand for labor with respect to the wage rate

The elasticity of demand for labor with respect to the wage rate will be less if firms using this labor are experiencing decreasing returns to scale than if they are experiencing increasing return to scale True false why

  Describe the shape of the average total cost function

Describe the shape of the average total cost function and also label the minimum point on the curve.

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