The two components of the total return or yield

Assignment Help Financial Management

Reference no: EM131841925

It has a principal value of $1,000, an annual coupon of 9.5%, and a required yield of 7% (assuming annual compounding). It matures in 15 years. Exactly one year passes. The bond still yields 7% and you sell it for its current price. I hope that you know that the total return you received for the year, is equal to the yield. What I want is for you to tell me the two components of the total return or yield. In this problem, tell me the current yield at t = 15 years.

Reference no: EM131841925

Questions Cloud

What is the dollar amount chrysler will pay : What is the dollar amount Chrysler will pay (or recieve) to settle this transaction three months from now?

What is the cost of unlevered equity : DA Inc. is currently an all-equity firm, with a value of $500. It has 25 shares outstanding. What is the cost of unlevered equity?

Constant dividend discount model and analyst estimate data : Using a constant dividend discount model and the analyst estimate data, what is the high, low, and weighted average estimate for the value of share of KTS stock

Invite in investment banker to give her additional guidance : When you present your thoughts to Sue she thinks about your input and decides to invite in an investment banker to give her additional guidance.

The two components of the total return or yield : What I want is for you to tell me the two components of the total return or yield.

Types of bonds has the least default risk : Which of following types of bonds has least default risk? Which of following types of bonds generally treats investors most favorably in terms of federal taxes.

Shares of the law firm according to the CAPM : what is the expected return on the shares of the law firm according to the CAPM? What would be the beta of your portfolio?

What was caterpillar book debt-to-value ratio : What was its market debt-to-value ratio? What was Caterpillar’s book debt-to-value ratio?

What role do financial institutions play in such a project : A college wants to buy computers and lab equipment for the Physics Department. What role do financial Institutions play in such a project?

User Account

All Pages