What is the call premium of the bond

Assignment Help Financial Management
Reference no: EM13809583

You own a bond with a 5.8 percent coupon rate and a yield to call of 6.7 percent. The bond currently sells for $1,098. If the bond is callable in five years, what is the call premium of the bond? (Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "$" sign in your response.)

Call premium   $   

Reference no: EM13809583

Questions Cloud

What is its dollar price assuming par value-quoted price : A noncallable Treasury bond has a quoted yield of 4.63 percent. It has a 5.6 percent coupon and 10 years to maturity. What is its dollar price assuming a $1,000 par value?
Connection between sugar consumption and attention in child : Write a paper about The Connection between Sugar Consumption and Attention in Young Children.
Municipal bond with a coupon rate : A municipal bond with a coupon rate of 4.80 percent sells for $4,850 and has five years until maturity. What is the yield to maturity of the bond?
Teaching and learning with technology : Teaching and Learning with Technology
What is the call premium of the bond : You own a bond with a 5.8 percent coupon rate and a yield to call of 6.7 percent. The bond currently sells for $1,098. If the bond is callable in five years, what is the call premium of the bond?
Do you seek personal growth by learning new skills : Do you seek personal growth by learning new skills? Do you search for lifelong learning opportunities and stimulating mental activties?
What percent of face value will you receive : A bond matures in 25 years, but is callable in 11 years at 123. The call premium decreases by 2 percent of par per year. If the bond is called in 16 years, what percent of face value will you receive? (
Determine the actual return for the fund : Determine the actual return for the fund over the 12 months ending October 2013. (This requires you to obtain prices and cash distributions from a source such as Yahoo Finance.) If an investor invested $10,000 at the end of October 2012, how much wou..
Describe scientific or technological activities : Describe how scientific or technological activities are exacerbating or improving the existing situation. Discuss how a proper application of the scientific method could have helped the problem.

Reviews

Write a Review

Financial Management Questions & Answers

  Calculated growth rate is expected continue dividend yield

Buy shares stock for $23.10. Expecting it to pay dividends of $1.09, 1.16, and 1.2345 in years 1,2, and 3 expecting to sell it at price of 30.82 at the end of three years. Calculate the growth rate in dividends? Calculate the expected dividend yield ..

  Should the company replace the furniture

A medium size consulting engineering firm is trying to decide whether it should replace its office furniture now or wait and do it 1 year from now. If the firm does it now, the cost will be $14,500. If it waits 1 year, the cost is expected to be $ 16..

  Bergman is aware that there are some qualitative factors

Jules Bergman is aware that there are some qualitative factors that are relevant to the surgery center decision. What qualitative factors might support project acceptance? What qualitative factors might preclude project acceptance?

  What is the APR and EAR on this loan

You have just purchased a new warehouse. To finance the purchase, you’ve arranged for a 30-year mortgage loan for 80 percent of the $3,400,000 purchase price. The monthly payment on this loan will be $17,500. What is the APR and EAR on this loan?

  How much tax deduction you would be entitled to

Suppose that you are the sole owner of an all-equity firm, the assets of which are worth $500,000. The tax rate is 34%. If you have the firm issue $100,000 of debt at 6%, how much tax deduction you would be entitled to?

  Tm owns an independent bookstore located in philadelphia

tom owns an independent bookstore located in philadelphia. tom has to decide on the best order quantity for a new

  Fundamentals of managerial finance

Bonds are thought to be a nice constant investment, paying a certain value of interest and then repaying your original investment [usually $1,000] after the bond term is up, usually in ten to thirty years.

  Purchase of a share of blue grass

You are considering the purchase of a share of blue grass, inc. Common stock. You expect to sell it at the end of one year for $87 per share. You will also receive a dividend of $5.36 per share at the end of the next year. If your required return on ..

  A bill is mailed to a client for services rendered

A bill is mailed to a client for services rendered. it will be paid in the following accounting period. Which of the following would be true as a result of mailing the bill to the client?

  In 1895 the first us open golf championship was held the

in 1895 the first u.s. open golf championship was held. the winners prize money was 150. in 2006 the winners check was

  Semi-annual coupon payments

What is the yield to maturity of a $1,000 par value bond with a coupon rate of 9.5% (semi-annual coupon payments) that matures in 28 years assuming the bond is currently selling for $838.13?rounded to one decimal place.

  Recalculate the payment based on a repayment term

Use a rate of 3.95% for a 30 year term. This is the APR. Assume you are making a down payment of 10%, so you will borrow 90% of the purchase price you selected. Calculate the monthly principal and interest (P&I) payment required if the loan is financ..

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