What is the maximum price you can anticipate

Assignment Help Econometrics
Reference no: EM13190729

You own a bond that pays a semiannual coupon of $100 on Jan. 1 and July 1 of each year until 2020, and will pay $10,000 in addition to the coupon payment on Jan. 1, 2020. Tomorrow (Jan 2, 2012) you receive two pieces of information:

(a) The best interest rate at which you can invest funds is 2%.
(b) Due to an unexpected change in your financial situation, you need to sell the bond that day (Jan. 2, 2012).

What is the maximum price you can anticipate receiving for the sale of your bond?

Reference no: EM13190729

Questions Cloud

How many numbers are in the set : The mean of a set of data is 174.25 and the sum of the data is 1,394. How many numbers are in the set?
Precipitation reaction will occur when aqueous solutions : Predict whether a precipitation reaction will occur when aqueous solutions of the following substances are mixed:
Building a new factory in your town : An automobile company is building a new factory in your town. what may be a positive externality of this event?
Demonstrate the process with your own example : Explain in your own words how the principle of square roots is used to solve quadratic equations. What form must a quadratic equation be in to use the principle of square roots for solving? Demonstrate the process with your own example.
What is the maximum price you can anticipate : own a bond that pays a semiannual coupon of $100 on Jan. 1 and July 1 of each year until 2020, and will pay $10,000 in addition to the coupon payment on Jan. 1, 2020. Tomorrow (Jan 2, 2012) you receive two pieces of information.
What are the unigueness conditions for l1 norm space : what are the Unigueness conditions for L1 norm space and why it does not applied very much.
Training-development activities to company''s business goal : How do we link our training/development activities to the company's business goals? How do we calculate our ROI for training activities and why is it important?
Find out the limiting reactant and calculate : performed using 1.8912g of zinc and 1.5965g of iodine. Determine the limiting reactant and calculate the theoretical yield of zinc iodine in grams.
Find the amount of gas required of city driving : a 2005 honda minivan can travel 240 miles in the city on 4 gallons of gas. Find the amount of gas required for 360 miles of city driving.

Reviews

Write a Review

Econometrics Questions & Answers

  How many boats will be built per year

On a tropical island there are 100 potential boat builders, numbered 1 through 100. Each can build up to20 boats a year, but anyone who goes into the boatbuilding business has to pay a fixed cost of $19. Marginal costs differ from person to person..

  What are general equilibrium values of real interest rate

An economy has full-employment output of Y%u0305 = 1850. Desired consumption and desired investment are: \(C^{d}= 500 + .5(Y-T)-100r\) \(I^{d}= 400 - 100r\) Government purchases and taxes are G = T = 200. Money demand is: \(M^{d}=P(.5Y-200i)\) The n..

  Determine who will have the greater balance

John and Susan opened savings accounts at two different banks. They each deposited $1,000. John's bank pays SIMPLE interest at an annual rate of 10% but Susan's bank pays COMPOUND interest at an annual rate of 9.5%.

  Calculate the predicted probabilities

Calculate the predicted probabilities and verify that all the ?tted values are between 0 and 1. What is the smallest value you observe? And the largest?

  Estimate the regression equation of wage

Estimate the regression equation of wage on educ. Write down formally the regression equation with standard errors underneath within parenthesis.

  At what price-output combination is total profit maximized

PRESTO Products, Inc, manufactures small electrical appliances and has recently introduced an innovative new dessert maker for frozen yogurt and tofu that has the clear potential to offset the weak pricing and and sluggish volume growth experience..

  How much are households paid for providing entrepreneurship

suppose tht businesses buy a total of 100$ billion of the four resources(labor, land, capital and entreprenrial ability) from households. If households receive 60$ billion in wages, 10$ billion in rent and 20$ billion in interest

  Estimate the future general inflation rate

A Man is planning to retire in 20 years. He can deposit money for his retirement at 6% compounded monthly. It is estimated that the future general inflation rate will be 5% compounded annually. What deposit must be made..

  What price and quantity is zenvoxs total revenue maximized

The Zenvox TV Company faces a demand function for its products that can be expressed as Q = 4,000 - P + 0.5i, where Q is the number of tv's, P is the price per tv, and i is the average monthly income. Average monthly income is currently equal to $..

  Equation for the monopolist''s marginal revenue funtion

A monopolist's inverse demand function is P = 150 - 3Q. The company produces output at two facilities; the marginal cost of producing at facility 1 is MC1(Q1) = 6Q1, and the marginal cost of producing at facility 2 is MC2(Q2) = 2Q2. Provide the eq..

  What uniform annual investment will he have to make

man wants to help provide college education for his daughter. He can afford to invest $600/yr for the next 4 years, beginning on the girl's 4th birthday, he wishes to give his daughter $4000 on her 18th 19th 20th and 21th birthdays, for a total of..

  Calculate what happens to the income of workers

What is each orchard's labor demand as a function of the daily wage W? What is the market's labor demand?b. Ectenia has 200 workers who supply their labor inelastically. Solve for the wage W. How many workers does each orchard hire? How much profit..

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