Reference no: EM132056894
Question: Problem-Solving for stocks and bonds:
(a) Calculate the nominal yield, current yield, and yield-to-maturity for a 30-year bond that has a face value of $1,000, sells for $1275.29, and pays an annual coupon payment of $80, when the market interest (i.e., discount) rate is 6%.
(b) Calculate the nominal yield, current yield, and yield-to-maturity for a 20-year bond that has a face value of $1,000, sells for $788.12, and pays an annual coupon payment of $50, when the market interest rate is 7%.
(c) Calculate the duration of a $1,000 bond that has a maturity of five years, an annual coupon rate of 5%, and sells for its present value of $810.46, with a yield to maturity of 10%.
(d) Calculate the percentage change in the market price of a bond that has a duration of 7 years, if its yield to maturity increased from 6% to 8%.
(e) Calculate Sharpe's measure and Treynor's measure of risk premium for each of the following portfolios, and determine which is the better performing portfolio: (1) Portfolio A, with ip = 16%, if = 4%, standard deviation = 6%, and beta = 1.3; (2) Portfolio B, with ip = 14%, if = 4%, standard deviation = 3%, and beta of 0.9%.
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Prepare the journal entry to record the exchange
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Net present value of acquiring red sox to blue sox
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Non-negative weights between two uncorrelated stocks
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What is the value of mb engineering to nano manufacturing
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Calculate the nominal yield and current yield
: Calculate the nominal yield, current yield, and yield-to-maturity for a 30-year bond that has a face value of $1,000, sells for $1275.29.
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What is the merger premium per share
: Dell has 8,000 shares outstanding at a market price of $25 a share. Neither firm has any debt. Dell is acquiring ABC for $350,000 in cash.
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Calculate standard deviation of returns for company shares
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What net reduction in retained earnings
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Compute the present value of the woodland
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