What is the yield to maturity on a ten-year

Assignment Help Finance Basics
Reference no: EM131378914

Assignment

Directions: Answer the following questions on a separate document. Explain how you reached the answer or show your work if a mathematical calculation is needed, or both. Submit your assignment using the assignment link in the course shell. This homework assignment is worth 100 points.

Assume that you are nearing graduation and have applied for a job with a local bank. The bank's evaluation process requires you to take an examination that covers several financial analysis techniques. Use the following information for Questions 1 through 2:

1. What is the present value of the following uneven cash flow stream -$50, $100, $75, and $50 at the end of Years 0 through 3? The appropriate interest rate is 10%, compounded annually.

2. Suppose that on January 1 you deposit $100 in an account that pays a nominal (or quoted) interest rate of 11.33463%, with interest added (compounded) daily. How much will you have in your account on October 1, or 9 months later?

Use the following information for Questions 3 and 4: A firm issues a 10-year, $1,000 par value bond with a 10% annual coupon and a required rate of return is 10%.

3. What is the yield to maturity on a 10-year, 9% annual coupon, $1,000 par value bond that sells for $887.00? That sells for $1,134.20? What does a bond selling at a discount or at a premium tell you about the relationship between rd and the bond's coupon rate?

4. What are the total return, the current yield, and the capital gains yield for the discount bond in Question #3 at $887.00? At $1,134.20? (Assume the bond is held to maturity and the company does not default on the bond.)

Reference no: EM131378914

Questions Cloud

Write a few lines of soliloquy : Discuss your reaction to the character of Hamlet in the two (2) soliloquies from the text. Consider the extent to which you sympathize with him and / or think he is self-absorbed. write a few lines of soliloquy, thinking aloud in front of the audie..
How did the financial crash impact you and your family : After watching the Inside the Financial Crash video, how did this financial crash impact you, your family, a career you may have been laid-off from, and/or someone you know that were affected?
Health risks of using genetically modified organisms : The health risks of vaccination - The ethical, environmental or health risks of using genetically modified organisms
Was a law violated in given case : Later, while cleaning her car, Horack found a service receipt showing that the actual mileage on the car a year earlier was 45,000 miles. Was a law violated? Explain.
What is the yield to maturity on a ten-year : What is the yield to maturity on a 10-year, 9% annual coupon, $1,000 par value bond that sells for $887.00? That sells for $1,134.20?
What threat to this unique macanese culture exists today : How is the language, food, and religion of the Macanese a reflection of the island's colonial past? What threat to this unique Macanese culture exists today
Describes the societal consequences of doubting science : Make a solid argument for why you think many people do not believe conclusions from the scientific community? Give a few examples to support your argument.
Could natalie used family name when she applied for credit : She was told that she must use her married name on a credit application. Could Natalie have used her family name when she applied for credit? Explain.
How did greek culture change : How did Greek culture change as a result of Alexander's conquests? In Plato's description in the Phaedo, Socrates draws the greatest comfort during his hour of death from

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!

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