User Account

All Pages

Maturity depending upon the market interest rates

Assignment Help Finance Basics
Reference no: EM13827730

Problem:

Consider a one-year maturity, $100,000 face value bond that pays a 6 percent fixed coupon annually.

1. What is the price of the bond if market interest rates are 7 percent?

a. $99,050.15.
b. $99,457.94.
c. $99,249.62.
d. $100,000.00.
e. $99,065.42.

2. What is the price of the bond if market interest rates are 5 percent?

a. $100,952.38.
b. $101,238.10.
c. $100,963.71.
d. $100,000.00.
e. $101,108.27.

3. What is the percentage price change for the bond if interest rates increase 50 basis points from the original 6 percent?

a. -0.1033 percent.
b. -0.4766 percent.
c. -0.4695 percent.
d. 0.0000 percent.
e. -0.2907 percent.

Summary

These short questions is from Finance and they deal with the computation of price of a bond with one year maturity depending upon the market interest rates.

Reference no: EM13827730

Questions Cloud

Correlation research : Briefly describe whether you think your area of interest is more conducive to experimental or correlation research. What are the costs/benefits of each as it relates to your research area
Computation of price of the bond : These short questions is from Finance as well as they deal with the computation of price of the bond with 1 year maturity depending on the market interest rates.
E-commerce : E-commerce
Define principle that underpin national occupation standards : The question in Sociology and the question clarify about the principle and values that underpin the National Occupational Standards for Work with Parents.
Maturity depending upon the market interest rates : Consider a one-year maturity, $100,000 face value bond that pays a 6 percent fixed coupon annually. What is the price of the bond if market interest rates are 7 percent?
Case study - airbus - customer strategy at airbus : Case Study - Airbus - Customer Strategy at Airbus
Calculation of location of significant difference in groups : The question related to Basic Statistics and it discusses about two multiple choice questions. The first question is about calculation of location of significant difference in groups. The second question is about calculation of HSD
Evaluating existing imc creative : Evaluating Existing IMC Creative
Individual marketing plan approval : Individual marketing plan approval

Reviews

Write a Review

Finance Basics Questions & Answers

  Business question-organizational structure

Differentiate between the organizational structures of various types of health care organizations. Describe the relationship between organizational structure and health care delivery, particularly as it relates to services and management.

  New york stock exchange

Select a publicly traded company that trades on the New York Stock Exchange (NYSE) or on the NASDAQ to analyze (Walt Disney-DIS is the company). Please answer the following questions:

  Interest rates fluctuate in the economy over various cycles

Interest rates fluctuate in the economy over various cycles. When interest rates are low, organizations may decide to issue debt as the cost of debt is low. However, this is likely to happen only with financially strong organizations because inter..

  Calculate total asset turnover and operating profit margin

The yearly sales for Salco Corporation. were $4.5 million last year. The company end-of-year balance sheet was as follows:

  Houma bio-control has hired you as a consultant to assess

houma bio-control has hired you as a consultant to assess the economic feasibility of investing 2500000 to purchase a

  Government issued t-bills and munis

Government issued T-bills and munis. Would you invest in government issued T-bills? Why or why not? Are there specific munis you would or would not invest in? What factors affect your choices? Write your analysis of the current status of gover..

  Fill in the missing values in the table

Is the stock of Firm A correctly priced according to the capital-asset-pricing model (CAPM)? What about the stock of Firm B? Firm C? If these securities are not correctly priced, what is your investment recommendation for someone with a well-diver..

  Accounts periods and basics concepts

Accounts periods and basics concepts - Multiple Choice questions and What is Sheepskin's 2006 net income using accrual accounting

  Should tangshan mining company accept a new project

Should Tangshan Mining company accept a new project if its maximum payback is 3.25 years and its initial after tax cost is $5,000,000 and it is expected to provide after-tax operating cash inflows of $1,800,000 in year 1, $1,900,000 in year 2, $70..

  A three-month treasury bill and a six-month bill both sell

1. a three-month treasury bill and a six-month bill both sell at a discount of 10. which offers the higher annual

  Qnational newsmagazine publishes the article on efforts to

q.national newsmagazine publishes the article on efforts to limiting smoking in public places. then the magazine gets

  Why do public utilities generally use different capital

why do public utilities generally use different capital structures than pharmaceutical

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd