The bond makes annual coupon payments

Assignment Help Financial Management
Reference no: EM13943322

The Johnson National Bank has purchased a bond that has a coupon rate of 5.5% and a face value of $1000. It has 4 years to maturity and is selling in the market for $917. The bond makes annual coupon payments. What is the duration of the bond? A) 5.5% B) 4.0% C) 1.5% D) 8% E) None of the above Show work

Reference no: EM13943322

Questions Cloud

Changing needs of the market : Carry out a written critique of the way in which characteristics of the chosen innovative product or service has altered over time in order to suit the changing needs of the market by taking account of the following:
Diversification refers to the process : Diversification refers to the process of:
Highest earning per share of ordinary share capital : Business is going well for David Johns Inc., the company that operates remote parking lots near major airports. The board of directors of this family-owned company believes that David Johns Inc. could earn an additional $1.5 million income before int..
Impact role of communication in a business : This part of the assignment, you will be required to substantiate your claim above (importance/impact role of communication in a business), with references to similar cases available from journals and other academic sources as well as the white pa..
The bond makes annual coupon payments : The Johnson National Bank has purchased a bond that has a coupon rate of 5.5% and a face value of $1000. It has 4 years to maturity and is selling in the market for $917. The bond makes annual coupon payments. What is the duration of the bond? A) 5.5..
What does a swot analysis of netflix reveal : What does a SWOT analysis of Netflix reveal about the overall attractiveness of its situation?
Unusually high projected short-term investment balance : When forecasting balance sheet financials, an unusually high projected short-term investment balance suggests which of the following?
Average accounting return-internal rate of return : There are several measures available to financial managers to assist them in deciding whether a specific project should be undertaken for the benefit of the company, including Average Accounting Return, Internal Rate of Return (IRR), Net Present Valu..
Basiclinkedtree and bstree classes : This generic class is used in the BasicLinkedTree and BSTree classes.  The class consists of a reference to the data and a reference to the left and right child.Follow the Javadoc that is provided.  The Javadoc only lists those public methods that..

Reviews

Write a Review

Financial Management Questions & Answers

  In this assignment you will conduct an evaluation of a

in this assignment you will conduct an evaluation of a company based on its annual report. this assignment will provide

  Principal of the loan and how much will go toward interest

You have just taken out a $22,000 car loan with a 6% APR, compounded monthly. The loan is for five years. When you make your first payment in one month, how much of the payment will go toward the principal of the loan and how much will go toward inte..

  A zero bond with a long maturity date

A zero bond with a long maturity date has:

  Calculate the change in nii and nim

Calculate the change in NII and NIM. Is this uneven shift in rates more or less likely than a parallel shift? Suppose the bank converts $ 20,000 of RSLs to fixed rate liabilities during the year and interest rates remain constant. What would the bank..

  What is the target stock price in five years

In practice, a common way to value a share of stock when a company pays dividends is to value the dividends over the next five years or so, then find the “terminal” stock price using a benchmark PE ratio. Suppose a company just paid a dividend of $1...

  What is transports cost of retained earnings

The risk free rate of return is 2.5% and the market return is 8%. Rogue Transport has a beta of 2.2 and a standard deviation of returns of 28%. Rogue Transport's marginal tax rate is 35%. Analysts expect Rogue Transport's dividends to grow by 6% per ..

  Issue of bonds with a maturity

Suppose Hillard Manufacturing sold an issue of bonds with a 10-year maturity, a $1,000 par value, a 10% coupon rate, and semi annual interest payments. Two years after the bonds were issued, the going rate of interest on bonds such as these fell to 6..

  Daily volatilities of these two assets

Suppose that the daily volatilities of these two assets are 1.8% and 1.2% respectively, and that the coefficient of correlation between their returns is 0.6. What is the 10-day 97.5% VaR for the portfolio? By how much does diversification reduce the ..

  What rate of return must he earn

Mr. Fish wants to build a house in 8 years. He estimates that the total cost will be $150,000. If he can put aside $11,000 at the end of each year, what rate of return must he earn in order to have the amount needed?

  What is the intrinsic value of the companys common stock

Whats the intrinsic value of the stock based on the required rates of return - What is the intrinsic value of the companys common stock?

  How much will our new proposal cost the taxpayers

Our new project proposal will require roughly 500 hours of total staff time and $1,000 in materials. Our total staff budget is $520,000 for 10 full time equivalents (FTE). How much will our new proposal cost the taxpayers?

  Several herb extractor evaporators

Klondike Pharmaceuticals has several herb extractor evaporators that were purchased four years ago at a price of $20,000 (you can ignore inflation). These machines currently require annual maintenance costs of $2,000. The machines could be sold, as i..

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