### Assume that the yield to maturity remains constant

Assignment Help Financial Management
##### Reference no: EM132014839

A bond has a \$1,000 par value, 7 years to maturity, and a 9% annual coupon and sells for \$1,095.

A) What is its yield to maturity (YTM)? Round your answer to two decimal places.

B) Assume that the yield to maturity remains constant for the next 2 years. What will the price be 2 years from today? Do not round intermediate calculations. Round your answer to the nearest cent.

### Write a Review

#### Should the firm undertake this investment opportunity

Because the new asset mix is riskier, the firm's unleveraged required return would also increase to 15%. Should the firm undertake this investment opportunity?

#### Assuming the projected improvements in working capital

Given the information in the projected income statements and assuming the projected improvements in working capital.

#### An exchange call option with expiration of one year allows

An exchange call option with expiration of one year allows the owner to acquire one share of a stock A for one share of a stock B. The price of the option is \$2.16. Stock A pays dividends at the continuously compounded yield of 7%. Stock B pays no di..

#### What is present value of these cash flows

Assuming you will receive the cash flows listed below at the corresponding periods, What is the present value of these cash flows?

#### Decrease the next present value of project

Which one of the following will decrease the next present value of a project?

#### Using the capm required rate of return of equity

using the CAPM required rate of return of equity is 15.2%, what is the WACC? (Please provide your answer to the fourth decimal place.)

#### How much do you have to invest in nominal terms

Your current age is 22 and you plan to retire at age 67. At retirement you want to have a “nest egg” of \$2 million in today’s buying power. Over that time-period you expect inflation to average 3% per year. If you can earn 4.6% APR, compounded monthl..

#### What principle might smart inventions be liable

Under what principle might Smart Inventions be liable for Nokes’s fraud? Is Smart Inventions liable in this case?

#### Shares of international business machines

You would like to sell 100 shares of International Business Machines (IBM).

#### Capital intensity ratio at the current level of sales

What is the Capital Intensity Ratio at the current level of Sales?

#### Rate of return is applicable to this potential purchase

Marko, Inc. is considering the purchase of ABC Co. Marko believes that ABC Co. can generate cash flows of \$5,000, \$9,000, and \$15,000 over the next three years, respectively. After that time, Marko feels ABC will be worthless. Marko has determined th..

#### Uses cash method of accounting and is calendar-year taxpayer

Ashley is an attorney who specializes in family law. She uses the cash method of accounting and is a calendar-year taxpayer. Last year, she represented a client in a lawsuit and billed the client \$5,000 for her services. What is the amount, if any, o..