What is your return rate in one year

Assignment Help Financial Management
Reference no: EM13911135

Last year, you purchased a $1,000 par value bond with a 7.5% annual coupon and a 20-year maturity. At the time of the purchase, it had an expected YTM of 8%. After receiving the coupon, you sold the bond today for $930. What is your return rate in one year?

Reference no: EM13911135

Questions Cloud

What is the difference between managerial and financial : What is the difference between managerial and financial accounting?
What are the business processes included with the scope : What are the business processes included with the scope of product life cycle management?
What is the role of a crm system : What is the role of a CRM system? What sort of benefits can such a system produce for a business?
How does materials requirement planning support : How does materials requirement planning support the purchasing process? What are some of the issues and complications that arise in materials requirement planning?
What is your return rate in one year : Last year, you purchased a $1,000 par value bond with a 7.5% annual coupon and a 20-year maturity. At the time of the purchase, it had an expected YTM of 8%. After receiving the coupon, you sold the bond today for $930. What is your return rate in on..
What is the value of their shares of stock : Paradise Adventures just paid a dividend of $2.00. They are growing rapidly and are expecting to grow dividends at 20% for the next two years and then 10% in the third year before reducing the dividends to a constant growth rate of 3%. If the require..
Using the corporate valuation model : Assume today is December 31, 2013. Barrington Industries expects that its 2014 after-tax operating income [EBIT(1 – T)] will be $400 million and its 2014 depreciation expense will be $70 million. Using the corporate valuation model, what should be th..
Discuss the benefits and potential risks of sharing product : Discuss the benefits and potential risks of sharing product data with external users through use of a PLM system.
What is the effect of compound interest : If you invest $700 today in an account that pays 6.5 percent compounded semi-annually, how much will be in your account after eight years? What is the effect of compound interest? Please show your work.

Reviews

Write a Review

Financial Management Questions & Answers

  Information get into prices-what are abnormal returns

The book discusses the Efficient Market Hypothesis (EMH) and its three forms. The EMH has a lot to do with information and stock prices. How does information get into prices? How do we know if prices reflect all available information?

  What is the cost of equity after recapitalization

O’Connell & Co. expects its EBIT to be $74,000 every year forever. The firm can borrow at 7 percent. O’Connell currently has no debt, and its cost of equity is 12 percent and the tax rate is 35 percent. The company borrows $125,000 and uses the proce..

  How much additional expected return can you earn

Assume, that stocks in this economy are price according to CAPM. You are holding a portfolio of stocks where the beta of your portfolio is 1.5 and its correlation with the market portfolio is 0.75. The risk-free rate is 5%, the expected market return..

  Capital gains associated with disposal of the equipment

Equipment costing $20,000 that is a MACRS 3-year property is disposed of during the second year for $12,000. Calculate any depreciation recapture, ordinary losses, or capital gains associated with disposal of the equipment.

  According to the efficient market hypothesis

According to the efficient market hypothesis, price of actively traded stocks ____.

  Prepare a report that analyze the governance structure

Then prepare reports analysing the governance structure and practices of two companies. State whether there is consistency between the company's financial conditions as evaluated and discussed.

  What is the percentage change in the euros value

In 1999, the euro was trading at $0.90 per euro. If the euro is now trading at $1.16 per euro, what is the percentage change in the euro’s value? Is this an appreciation or depreciation?

  Calculate the return on holding the stock for a day

Obtain the closing price, the change in price from the previous day, and the beta and calculate the return on holding the stock for a day.

  Identifies and analyzes the most important external

complete the external environmental scan for your organization.nbspperform an internal competitive environmental scan

  What is a market price of face value bond

Guegen inc offers a 9.00% bond with annual payment. The YTM is4.9% and maturity date is 10 years. What is a market price of a $1000 face value bond? Wine and roses inc offers a 9.0% coupon bond with semi-annual payment and YTM of 9.65%. The bonds mat..

  Use of debt within the capital structure selected by a firm

Which one of the following is the risk arising from the use of debt within the capital structure selected by a firm?

  About expansion-investment in net operating working capital

Truman Industries is considering an expansion. The necessary equipment would be purchased for $9 million, and the expansion would require an additional $1 million investment in net operating working capital. The tax rate is 40%. What is the initial i..

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