What implied rate of return does the bond offer

Assignment Help Finance Basics
Reference no: EM13268490

A riskless zero-coupon (no intermediate/periodic coupon payments) bond that will pay $1,000 in 10 years is selling today for $350. What implied rate of return does the bond offer?

a. 3.5%
b. 0%
c. 11.07%
d. 35%

 

Reference no: EM13268490

Questions Cloud

Find the potential difference between the ends of the bar : A uniform magnetic field B is perpendicular to the plane of rotation. What is the potential difference between the ends of the bar
Find the norton equivalent current for the circuit : A somewhat discharged automotive battery has an open-curcuit voltage of 12.5 V and supplies 50 A when a 0.1 ohm resistance is connected across the battery terminals. find the thevenin equivalent voltage
Compute the wavelength of the laser light : A laser beam is incident on two slits with a separation of 0.230 mm, and a screen is placed 5.10 m from the slits. what is the wavelength of the laser light
Find the matrix representation of differentiation operation : Suppose that the voltage v(t) is then inputted to a differentiator circuit. Find the matrix representation of the differentiation operation with respect to the basis B. Verify your derivative using your knowledge from calculus.
What implied rate of return does the bond offer : A riskless zero-coupon (no intermediate/periodic coupon payments) bond that will pay $1,000 in 10 years is selling today for $350. What implied rate of return does the bond offer?
What is the effective interest cost of this loan : Set up the amortization schedule for a 5-year, $1 million, 9 percent term loan that requires equal annual end-of-year payments plus interest on the unamortized loan balance. What is the effective interest cost of this loan?
What are the implications of a higher interest rate : What is it worth if the discount rate increases to 6% because of some risk? Show your calculation. What are the implications of a higher interest rate?
Calculate the kinetic energy of the electrons : A beam of electrons is incident on two slits separated by a distance of 2.0×10-6 m. Calculate the kinetic energy of the electrons
What is the future value of these investment cash : what is the future value of these investment cash flows six years from today?

Reviews

Write a Review

Finance Basics Questions & Answers

  Describe the term efficient market

Carefully describe what is meant by the term efficient market. Art there different levels of market efficiency discuss those levels?

  Compute probability of hedging

Jones Corporation needs 200,000 Canadian dollars in 90 days and is trying to estimate whether or not to hedge this position. Jones has developed the following probability distribution for the C$:

  What is the value of a one-year european call option

A stock price is currently $100. Over each of the next two six-month periods it is expected to go up by 10% or down by 10%. The risk-free interest rate is 8% per annum with continuous compounding. What is the value of a one-year European call opti..

  Exercise of significant influence

How is the ability to significantly influence the operating and financial policies of a company normally demonstrated?

  Alpha products plans to finance

Alpha Products plans to finance its capital budget for next year by selling $50 million of 11 percent coupon rate bonds, with each bond having a maturity value (M) of $1,000 and a 20-year maturity.

  Determine the highest return investment

Determine which of the given three investments offers you the highest rate of return on your $1,000 investment over the next 5-years.

  Prepare journal entries for acquisition

Penny's Concrete acquired 25% of outstanding common stock of Cardinal Inc on January 1, 2005, by paying $1,200,000 for 50,000 shares.

  Find what is the required rate of return

Find what is the required rate of return on a portfolio consisting of 80% of stock x and 20% of stock y?

  Find the amount of the loan

An automobile company, Nissan, as temporary cash surplus and lends its funds overnight through a repurchase agreement to a government securities dealer, earning $55,600 in interest income when RP loan rate stood at 5.70%.

  Determine the project irr and cost of capital

Determine the project IRR and the cost of capital for the project? Does the accept reject decision using IRR agree with the decision using NPV?

  Payout policy and capital structure for perpetual project

Suppose first that the project will be partly financed with $400,000 of debt and that the debt amount if it be fixed and perpetual. Then suppose that the initial borrowing will be increased or reduced in a proportion to changes in the market value ..

  Why is national average property tax rate likely to affect

Why is the national average property tax rate likely to affect the return to capital in investments other than real estate?

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