User Account

All Pages

What is the current market value of the bond

Assignment Help Finance Basics
Reference no: EM132183874

Question - Rick bought a 30-year old bond when it was issued by Macroflex Corporation 15 years ago. The bond has $1,000 face value and a coupon rate equal to 7% and the coupon is paid every six month. If the yield on similar-risk investments is 8%.

a) What is the current market value (price) of the bond?

b) Suppose the interest rate levels rise to the point where such bonds now yield 10%. What would be the price of Macroflex bond?

c) At what price would Macroflex bonds sell if the yield on them was 5%?

d) What do you observe regarding the relationship bet interest rate (YTM) bond's price?

e) What do you observe regarding the relationship between coupon, YTM, and the bond's price?

Reference no: EM132183874

Questions Cloud

How does this impact the npv and roi and the roi : The school can either encourage graduates to give more. How does this impact the NPV and ROI and the ROI? Is this a good plan
Difference between standard output and error output : What is the difference between standard output and error output?
How management should plan and execute : HRM09403 Organisational Change Management - A critical examination of the possible types of employee reactions to the proposed change, again using the theory
Define security requirement to align with wicked environment : In approximately 300 words, answer the question below. Follow APA guidelines. Describe a situation when it might be ideal to define security requirements.
What is the current market value of the bond : Rick bought a 30-year old bond when it was issued by Macroflex Corporation 15 years ago. What is the current market value (price) of the bond
What is data warehouse-oltp-metadata : 1) What is Data warehouse, OLTP, metadata. What is the relationship between them. What are the differences between them.?
What limitations or constraints are present in systems : In approximately 300 words, answer the question below. Follow APA guidelines. What limitations or constraints are present when implementing cryptography.
What is data warehouse : What is Data warehouse, OLTP, metadata. what is the relationship between them. What are the differences between them?
Review problem on supply chain management : Supply chain management involves tracking the flow of goods and services from the acquisition of inputs to the delivery of output to the consumers.

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

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: +91-977-207-8620

Phone: +91-977-207-8620

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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