Compute the internal rate of return, Cost Accounting

ABC bond is a 20-year bond with face value $1000. The coupon payment is $25 per 6 months. The semi-annual yield is 4%. Use the PV function in Excel (or equivalent) to Önd the price of the bond. Note that the entry FV in the Excel PV function is the maturity, or face value of the bond.

b. Use the inputs as in the first part, but let semi-annual yields range from 1% to 6%. Plot the prices of the bonds.

c. Compute the internal rate of return (IRR) on a 20-year bond with face value $1000, coupon payments of $25 per six months and a current price of $975. Use the IRR function in Excel (or equivalent).

d. Compute the duration of the bond in part a).

Posted Date: 3/1/2013 1:19:53 AM | Location : United States







Related Discussions:- Compute the internal rate of return, Assignment Help, Ask Question on Compute the internal rate of return, Get Answer, Expert's Help, Compute the internal rate of return Discussions

Write discussion on Compute the internal rate of return
Your posts are moderated
Related Questions
Visual Fit Method of Cost Estimation Cost estimation is based on past data regarding the dependent variable and the cost driver. The previous data on cost levels and the outpu

Good Food Company is a local manufacturer of instant noodles. Established in 2005, their business has been growing steadily. Their products, which are available in 3 flavors, are s

DIFERENCE BETWEEN MARGINAL AND DIFFERENTIAL COSTING

Calculate Cost or Equivalent Units The given work in progress account concerns to the blending department of a company, a soft-drinks company for the month of January in 1999

Allocation of Overhead Costs Allocation of overheads is the term utilized where the overhead cost item can be charged to a exact cost center without the requirement for any es


What is callable preferred stock? Why do corporations issue such stock? Given the different features that are associated with stock (callable, cumulative, preferred, etc.), what ty

Goal Congruence - Behavioural Aspects of Standards A perfect variance analysis and standard costing system must enhance goal congruence between as: i. The goal of individua

Cost Accounting Cost accounting has been defined via many accounting scholars in different forums. There is no single watertight definition of cost accounting, however the var

A soft drink maker wants to expand into a neighboring country.  They want the product bottled in that country to avoid political issues and to enhance the local image of the produc