What is the price of the bond-compounding periods

Assignment Help Financial Management
Reference no: EM131021571

You find a zero coupon bond with a par value of $10,000 and 17 years to maturity. If the yield to maturity on this bond is 4.9 percent, what is the price of the bond? Assume semiannual compounding periods.

Reference no: EM131021571

Questions Cloud

Is it easier or harder to file fraudulent taxes : With your experience in this course, what do you see as the most difficult components for individual preparers to understand about filing taxes?
Develop research and analytical skills : Develop research and analytical skills, applied to understanding the role of managers and their impact on organisations.
Account starts at the initial margin requirement : You’ve borrowed $20,000 on margin to buy shares in Disney, which is now selling at $50 per share. Your account starts at the initial margin requirement of 50%. The maintenance margin is 35%. Two days later, the stock price falls to $48 per share. a. ..
What will be your rate of return if price of telecom stock : The current market price is $250 per share, and you have $22,000 of your own to invest. You borrow an additional $22,000 from your broker at an interest rate of 6% per year and invest $44,000 in the stock. What will be your rate of return if the pric..
What is the price of the bond-compounding periods : You find a zero coupon bond with a par value of $10,000 and 17 years to maturity. If the yield to maturity on this bond is 4.9 percent, what is the price of the bond? Assume semiannual compounding periods.
Federal bankruptcy law deal only with corporate bankruptcies : Federal bankruptcy law deals only with corporate bankruptcies. Municipal and personal bankruptcy are governed solely by state laws. All bankruptcy petitions are filed by creditors seeking to protect their claims against firms in financial distress. T..
Distribution of assets in a liquidation : What would be the priority of the claims as to the distribution of assets in a liquidation under Chapter 7 of the Bankruptcy Act? 1 is the highest claim, 5 is the lowest.
The primary test of feasibility in a reorganization : The primary test of feasibility in a reorganization is whether every claimant agrees with the reorganization plan. The basic doctrine of fairness states that all debt holders must be treated equally. Since the primary issue in bankruptcy is to determ..

Reviews

Write a Review

Financial Management Questions & Answers

  Foreign exchange risk management policy

What is the company's Foreign Exchange (FX) Risk Management Policy? Is centralized or decentralized

  Why are equity investment returns typically more than bond r

Why are equity investment returns typically more than bond returns? A) Equities are riskier than bonds B) Bonds are riskier than equities C) Bonds pay interest payments   D) Both A & C

  Calculate the yield using a geometric average

One-year Treasury securities yield 3.5%. The market anticipates that 1 year from now, 1-year Treasury securities will yield 6.45%. If the pure expectations theory is correct, what is the yield today for 2-year Treasury securities? Calculate the yield..

  Counted as balance of payments transaction

Which of the following international transactions would NOT be counted as a balance of payments (BOP) transaction? PLEASE EXPLAIN YOUR REASONING

  What is the projects average accounting return

You’re trying to determine whether to expand your business by building a new manufacturing plant. The plant has an installation cost of $12.9 million, which will be depreciated straight-line to zero over its four-year life. If the plant has projected..

  What is the actual rate you are paying on this loan

You are looking at a one-year loan of $15,000. The interest rate is quoted as 10 percent plus 5 points. A point on a loan is simply 1 percent (one percentage point) of the loan amount. Quotes similar to this one are very common with home mortgages. T..

  How long will it be before you have enough to buy the car

You’re trying to save to buy a new $225,000 Ferrari. You have $38,000 today that can be invested at your bank. The bank pays 4.5 percent annual interest on its accounts. How long will it be before you have enough to buy the car?

  What is the cash break-even level of output for this project

You are considering a new product launch. The project will cost $1,700,000, have a four-year life, and have no salvage value; depreciation is straight-line to zero. Sales are projected at 140 units per year; price per unit will be $22,000, variable c..

  Dividend per share-growth is expected to continue

Waller Co. (WAG) paid a $0.145 dividend per share in 2006, which grew to $0.309 in 2012. This growth is expected to continue. What is the value of this stock at the beginning of 2013 when the required return is 14.5 percent?

  What are firms income tax liability and its after-tax income

The Talley Corporation had a taxable income of $350,000 from operations after all operating costs but before (1) interest charges of $70,000, (2) dividends received of $10,500, (3) dividends paid of $28,000, and (4) income taxes. What are the firm's ..

  What is the flotation cost adjustment

Barton Industries expects next year's annual dividend, D1, to be $1.80 and it expects dividends to grow at a constant rate g = 4.5%. The firm's current common stock price, P0, is $22.90. What is the flotation cost adjustment that must be added to its..

  Find probability that the stock of new castle is undervalued

Determine the required rate of return for New Castle's common stock. Determine the probability that the stock of New Castle is undervalued at its current market price of $25 per share.

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