Current rate of interest for similar investments

Assignment Help Business Economics
Reference no: EM131775934

Suppose that you invested $10,000 in a corporate bond 12 years ago and have been receiving annual payments of $500 on the bond. You will continue to receive annual payments of this same amount for the next 3 years, after which time you will also receive a payment equal to your initial investment as your final payment. Suppose another investor is interested in purchasing the bond from you. What is the minimum price you should accept for the bond if the current rate of interest for similar investments is 6 percent?

Instructions: Round your answer to the nearest dollar. Do not round intermediate calculations for (1 + i)t.

Reference no: EM131775934

Questions Cloud

Find the reorder point necessary to service probability : Find the reorder point necessary to provide a 98 percent service probability.
Specialize and optimize opportunity costs : The theory of comparative advantage states that there are gains from trade if countries specialize and optimize their opportunity costs.
Find a news article about an economic topic : Write details of any two economists using following instructions: Find a news article about an economic topic that you find interesting.
Sketch the performance function for the given situation : Assume that the distribution of the temperature would have 0.005 fraction of its operation exceeding the limit of 864°C and that each time the limit.
Current rate of interest for similar investments : What is the minimum price you should accept for the bond if the current rate of interest for similar investments is 6 percent?
Prepare journal entries to record the issuance of the bonds : Prepare journal entries to record the issuance of the bonds, Prepare journal entries to record the payment of interest on August 1, 2015
Characteristic of market structure : 1.) What is the difference between a market structure and a characteristic of market structure?
What is the quanity the monopolist will choose to maximize : Now suppose the gov passes a law setting the price of a backpack at $750. What is the quanity the monopolist will choose to maximize profits.
Determining the best temperature distribution : Sometimes there is no active hard constraint. Assume that the fired heater in Figure has no hard constraint, but that a side reaction forming undesired.

Reviews

Write a Review

Business Economics Questions & Answers

  Economics assignment

This document contains various important questions and their appropriate answers in the subject field of Economics.

  Demand and supply curves

Economics is the study of the principles governing the allocation of scarce means among competing ends when the objective of the allocation is to maximize the attainment of the ends.

  Long-run perfectly competitive equilibrium for the firm

Evaluate Government intervene and correct this situation?(a) Explain the concept of a concentration ratio. A rise in the price of magarine Explain the impact of external costs and external benefits on resource allocation long-run perfectly c..

  Supply and demand diagrams

Explain each of the following using supply and demand diagrams,  With the use of a graph, explain how these two programs affect cigarette consumption and the price of cigarettes.

  Case study: fisher-price toys

The case study of the Fisher-Price Toys, Inc., a popular case in basic economics and management from the prestigious Harvard Business School.

  Draw the production possibility curve

Draw the production possibility curve and a. Define consumer surplus and producer surplus.

  Tax revenue

The Australian government administers two programs that affect the market for cigarettes

  Maximize total welfare

How many tickets to sell to maximize total welfare.

  Difference between the cv and the ev

The change in consumer surplus (?CS) is not "theoretically" justifiable like the CV and EV but it continues to be the most widely used measure of consumer welfare change. Explain how this can be reconciled

  Depict von neumann-morgenstern utility index u in a diagram

Depict the von Neumann-Morgenstern utility index u in a diagram

  What is the market solution

What is the market solution (market price and quantity) and What is the total surplus of the society under the market solution

  Calculate gross national product and net national product

Calculate gross national product and net national product

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