Compute the value of green valley company bonds

Assignment Help Financial Management

Reference no: EM13872027

Green Valley company bonds have a 10.66 percent coupon rate. Interest is paid semi annually. The bonds have a par value of $1000 and will mature 16 years from now. Compute the value of Green Valley company bonds if investors' required rate of return is 8.50 percent. Round the answer to two decimal places.

Reference no: EM13872027

Questions Cloud

What is the discounted payback period : A project has an initial cost of $8,900 and produces cash inflows of $2,700, $5,100, and $1,700 over the next three years, respectively. What is the discounted payback period if the required rate of return is 7 percent?

Discuss ethical issues facing the top leadership : Unfortunately, in recent times, we have seen a number of examples of unethical behavior in organizations, often tied to the organization's handling of finances. Discuss ethical issues facing the top leadership or financial managers in today's corpora..

What is the percentage change in the price of these bonds : Both Bond Bill and Bond Ted have 10 percent coupons, make semi annual payments, and are priced at par value. Bond Bill has 3 years to maturity, whereas Bond Ted has 20 years to maturity. If interest rates suddenly rise by 3 percent, what is the perce..

Prior law restricted the ability of acquirers to use credits : In September 2008, the IRS changed tax laws to allow banks to utilize the tax loss carry forwards of banks they acquire to shield their future income from taxes (prior law restricted the ability of acquirers to use these credits).

Compute the value of green valley company bonds : Green Valley company bonds have a 10.66 percent coupon rate. Interest is paid semi annually. The bonds have a par value of $1000 and will mature 16 years from now. Compute the value of Green Valley company bonds if investors' required rate of return ..

What is the coupon rate on the bonds : Maxcorp’s bonds sell for $1,264.57. The bond life is 9 years, and the yield to maturity is 7.8%. What is the coupon rate on the bonds?

Yield to maturity is less than its coupon rate : A bond’s current yield must always be either equal to its yield to maturity or between its yield to maturity and its coupon rate. If a bond sells at par, then its current yield will be less than its yield to maturity. If a bond sells for less than pa..

What is their current yield : Malko Enterprises’ bonds currently sell for $1,050. They have a 6-year maturity, an annual coupon of $75, and a par value of $1,000. What is their current yield?

Bond is likely to be called if sells at discount below par : A bond is likely to be called if its coupon rate is below its YTM. A bond is likely to be called if its market price is below its par value. Even if a bond’s YTC exceeds its YTM, an investor with an investment horizon longer than the bond’s maturity ..

User Account

All Pages