Determine total expenditure, Finance Basics

Assignment Help:

Determine the amount you would be willing to pay for a $1,000 par value bond paying $80 interest each year (annual) and maturing in 12 years, assuming you wanted to earn a 9% rate of return. 

a

Interest per year

   

 mce_markernbsp;                              80.00

b

Years to maturity

   

12

c

Par value

     

 mce_markernbsp;                        1,000.00

d

Required rate of return

 

9%

e

Intrinsic value of bond

 

 mce_markernbsp;                           928.39

 

($1000/1.09^12 + $80 x PVIFA(12,9%)

 

 

 


Related Discussions:- Determine total expenditure

Management of inventories, Management of Inventories Manufacturing fir...

Management of Inventories Manufacturing firms contains three major kinds of inventories as: Work-in-progress Finished goods inventory Raw materials The firm

Bureaucratic system of management, "Managerial leadership considers that th...

"Managerial leadership considers that the focus of school leaders ought to be on functions, tasks and behaviours and if these functions are carried out competently the work of othe

Dividend ratios, Dividend Ratios 1. Dividend per shares (DPS) = Earn...

Dividend Ratios 1. Dividend per shares (DPS) = Earnings to ordinary shareholders/ Number of ordinary shares Specify cash returns received for all share holders. 2. Di

Factors that influence the cost of finance, Factors that Influence the Cost...

Factors that Influence the Cost of Finance 1. Terms of reference - if short term, the cost is generally low and vice versa. 2. Economic conditions prevailing - If a com

Example of net present value method, Example of Net Present Value Method ...

Example of Net Present Value Method Cost of investment = 100,000/=, Interest rate = 10percent, Inflows year 1 = 80,000/= Year 2 = 50,000/= NPV   = 80,000 / 1.1 + 5

THE CASE OF THE MISSING BONDS RATING, Three of these companies have bonds t...

Three of these companies have bonds that carry investment - grade ratings. The other 3 companies carry junk - bond ratings. Judging by the information in the table, which 3 compani

The profitability index for the investment, Question   Clifton-Peters L...

Question   Clifton-Peters Ltd is a manufacturer of household goods located in Melbourne. They presently make and wholesale fruit juicers, blenders and baking equipment. The Gen

Determine tax cash flows & irr, An industrial engineer proposed the purchas...

An industrial engineer proposed the purchase of a RFID Fixed Asset Tracking System for the company's warehouse and weave rooms.  The engineer though that the system would provide a

Define new issue market, Define New Issue Market New Issue Market OR P...

Define New Issue Market New Issue Market OR Primary Market New issue market is the segment in which new issues are made.

Explain the term - giving margin money to broker, Explain the Giving Margi...

Explain the Giving Margin Money to Broker Marin  is  the  amount  of  money  which is provided  by customer to the brokers who have agreed to trade their securities. It may

Write Your Message!

Captcha
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