Determine percentage holding period return on investment

Assignment Help Financial Management
Reference no: EM131340177

1. Suppose a U.S. Treasury bill, maturing in 30 days, can be purchased today for $99,500. Assuming that the security is held until maturity, the investor will receive $100,000 (face amount). Determine the percentage holding period return on this investment.

2. Suppose a Midwest Telephone and Telegraph (MTT) Company bond, maturing in one year, can be purchased today for $975. Assuming that the bond is held until maturity, the investor will receive $1,000 (principal) plus 6 percent interest (that is, 0.06 $1000 $60). Determine the percentage holding period return on this investment.

Reference no: EM131340177

Questions Cloud

Calculate the instantaneous value : Write down the standard expression for a voltage, of r.m.s. value 45 V, and frequency 1.5 kHz. Hence, calculate the instantaneous value, 38 s after the waveform passes through its zero value.
Calculate the investors percentage holding period return : An investor bought 10 Ellis Industries, Inc., long-term bonds one year ago, when they were first issued by the company. Calculate the investor's percentage holding period return for the one year he has held the bonds.
Characterize the important features of analyzed phenomena : Mathematical models are used as tools to describe reality. These models are supposed to characterize the important features of the analyzed phenomena and provide insight. The normal distribution is an example of a random variable that is widely us..
What three tools could the fed use to achieve the goal : Monetary policy is action taken by the Fed to influence the level of real GDP. Suppose the Fed wants to increase the money supply. What three tools could the Fed use to achieve this goal?
Determine percentage holding period return on investment : Assuming that the security is held until maturity, the investor will receive $100,000. Determine the percentage holding period return on this investment.
Record the first month transactions before printing : Record the first month's transactions before printing and submitting the following reports for December 2016 (either print to screen or print and scan as an electronic file). Marks will be awarded for the correctness of information as well as the ..
Calculate the amplitude of the generated emf : A sinusoidal voltage is generated by an 85 turn coil, of dimensions 20 cm by 16 cm. The coil is rotated at 3000 rev/min, with its longer sides parallel to the faces of a pair of poles.
Determine expected percentage holding period return : NTT is expected to pay a $4 dividend during the coming year, and the price of the stock is expected to increase to $65 a year from now. Determine the expected percentage holding period return on NTT common stock.
Discuss the evolution of presidential power in military : Select one (1) mental disorder that intrigues you the most, then suggest a treatment approach for the disorder you selected based on evidence discussed in the textbook related to the treatment of mental disorders. Next, discuss three (3) strategie..

Reviews

Write a Review

Financial Management Questions & Answers

  What is the price per share of the stock

Ward Corp. is expected to have an EBIT of $2,400,000 next year. Depreciation, the increase in net working capital, and capital spending are expected to be $175,000, $105,000, and $125,000, respectively. All are expected to grow at 18 percent per year..

  Assume opportunity cost

Assume an opportunity cost of 10%, what should you do under the trade credit terms, 2/10, net 45?

  What allows a company to earn economic rents

Provide financial evidence that the company is earning economic rents.

  Calculate the arithmetic return and geometric return

You are given the returns for the following three stocks: Year Stock A Stock B Stock C 1 14 % 14 % −19 % 2 14 14 34 3 14 22 37 4 14 7 14 5 14 13 4 Calculate the arithmetic return, geometric return, and standard deviation for each stock.

  What is the company pre-money value-post-money value

A Venture capital company buys 400,00 shares of a start-up’s stock for $5million. If the company as 1.6 million shares outstanding prior to the purchase, what is the company’s pre-money value? What is its post-money value?

  What is the estimated cost of common equity to the firm

(Cost of common equity) The common stock for the Hetterbrand Corporation sells for $59.17, and the last dividend paid was $2.24. Five years ago the firm paid $1.84 per share, and dividends are expected to grow at the same annual rate in the figure as..

  Forecast sales for the next day using three-day weighted

Daily demand for newspapers for the last 10 days has been as follows: 12, 13, 16, 15, 12, 18, 14, 12, 13, 15 (listed from oldest to most recent). Forecast sales for the next day using a three-day weighted moving average where the weights are 3, 1, an..

  Call option-find the maximum values

Consider an American call option on a stock. The time to maturity is 18 months, the risk-free interest rate is 2% and the exercise price is 50$. The underlying stock will pay dividend D1 in 4 months and dividend D2 10 months. Find the maximum values ..

  What happens to the bond yield to maturity

(Yield to maturity) A bond's market price is $950. It has a $1,000 par value, will mature in 14 years, and has a coupon interest rate of 8 percent annual interest, but makes its interest payments semiannually. What is the bond's yield to maturity? Wh..

  What factors are contributing to the success or lack

Briefly describe a corporate merger that you have read about recently or been part of as an employee. What kind of a merger was it? How well is it working from the perspectives of the various stockholders? As far as you are able to determine, what fa..

  If the yields on treasury bonds rise signifcantly

If the yields on treasury bonds rise signifcantly but there is no change in the outlook for economic growth and profits (and no change in investor risk aversion level or required risk premimuim) the stock market should

  What must be growth rate they expect of the firm

Eastern Electric currently pays a dividend of about $1.72 per share and sells for $31 a share. If investors believe the growth rate of dividends is 3% per year, what is the opportunity cost of capital? If investors' opportunity cost of capital is 10%..

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