Find what must the coupon rate be on mertons bonds

Assignment Help Financial Econometrics
Reference no: EM13334094

Merton Enterprises has bonds on the market making annual payments, with 14 years to maturity, and selling for $972. At this price, the bonds yield 8.4 percent.

What must the coupon rate be on Merton's bonds?

Reference no: EM13334094

Questions Cloud

Find how far does the cat move in relation to the pond : A cat stands on a board of wood in a frozen frictionless pond. The mass of the cat is 4.0 kg, and the mass of the board is 3.0 kg. how far does the cat move in relation to the pond
Evaluate the amount of heat transferred and reacts : Calculate the amount of heat transferred when 2.5 g of Mg(s) reacts at constant pressure. Express your answer using two significant figures
Describe how this genetic information results in formation : 1. Begin with the information in DNA, a specific gene. Describe how this genetic information results in the formation of a protein.
What is the new accelration of the system : Assuming frictionless conditions, a table has a hanging mass, m1, over a pulley at the left side and another hanging mass, If m1 = .45kg, & m2 = .3kg, & m3 = .25kg what is the new accelration of the system
Find what must the coupon rate be on mertons bonds : Merton Enterprises has bonds on the market making annual payments, with 14 years to maturity, and selling for $972. At this price, the bonds yield 8.4 percent.
Explain reaction spontaneous at standard conditions : At what temperatures is this reaction spontaneous at standard conditions. Assume that ?H° and ?S° do not depend on temperature.
Find how many forces act on the crate : A rocket, away from all gravitational forces, accelerates upward at an acceleration of 12.8m/s^2. On its main deck is a crate with a mass of 81.6kg. How many forces act on the crate
What will be the par value of the holdings in the 20-year : If a firm remains in business indefinitely, the pension obligation will resemble a perpetuity. Suppose, therefore, that you are managing a pension fund with obligations to make perpetual payments of $3.0 million per year to beneficiaries.
What is an imaginary number : Complex numbers are what you get when you add real and imaginary numbers. What is an imaginary number? How are they different or similar to real numbers? What applications do they have?

Reviews

Write a Review

Financial Econometrics Questions & Answers

  Determine what was cash flow for the year

All revenues were collected in cash, and all expenses, excluding depreciation, were paid in cash and all expenses exlduing depreciation were paid in cahs during the year.

  Determine the present value to invest funds at a rate

John Roberts is 50 years old and has been asked to accept early retirement from his company. The company has offered John three alternative compensation packages to induce John to retire.

  Determine what is the future value of the same annuity due

If the future value of an ordinary, 11 year annuity is $5,575 and interest rates are 5.5%, what is the future value of the same annuity due

  How to compute the required rate of return

Russo's Gas Distributor, Inc. wants to determine the required return on a stock with a beta coefficient of 0.5. Assuming the risk free rate of 6 percent and the market return of 12 percent.

  What factors should take into consideration when evaluating

What factors should I take into consideration when evaluating a companies capital budgeting decisions based on thier annual report. Please explain which factors to look at and what to consider.

  What is change in price the bond will experience in dollars

A 5.95 percent coupon bond with fifteen years left to maturity is priced to offer a 6.9 percent yield to maturity. You believe that in one year, the yield to maturity will be 6 percent. What is the change in price the bond will experience in dolla..

  What was the dividend yield and the capital gains yield

Suppose a stock had an initial price of $56 per share, paid a dividend of $1.60 per share during the year, and had an ending share price of $66. What was the dividend yield and the capital gains yield

  Determine what is the current yield for bond p and bond d

Bond P is a premium bond with a 12 percent coupon. Bond D is a 7 percent coupon bond currently selling at a discount. Both bonds make annual payments, have a YTM of 9 percent, and have seven years to maturity.

  Determine what will be the value of the house in 7 years

Say that you purchase a house for $150,000 by getting a mortgage for $135,000 and paying a $15,000 down payment. Assume you get a 15-year mortgage with a 6% interest rate.

  What is the implied expected rate of return for company x

A friend comes to you with the following information on company X. He tells you that the company has price to earnings ratio (P0/E1) of 16 and a dividend payout ratio (D1/E1) of 40%.

  Determine minimum variance portfolio with expected return

Stock B has expected return of 16% and standard deviation of 35%. Stock C has expected return of 12% and standard deviation of 22%. Their returns have correlation of 0.15.

  Caculate the fair value of a stock with a beta

caculate the fair value of a stock with a beta of .90 if the riskless rate is 4% and the expected market return is 7% if the stock is expected to pay a dividend $.50 and is expected

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