Jonabelle is considering investing in bonds. Some data are as follows: Face Value of bonds P 3,000,000 Date of bond issuance Date of bond maturity Payment interest Nominal interest rate Effective interest rate Required: Compute for the following: 1. Expected market Price of the bond 2. Amount of premium or discount of the bond January 1,2022 January 1,2027 Quarterly 8% 12%
Q: rate would be publishe on this Treasury bill? What is the annual interest rate of this bill that…
A: A treasury bill is a type of fixed income issued by the central government that sells at a price…
Q: The Yurdone Corporation wants to set up a private cemetery business. According to the CFO, Barry M.…
A: Net Present Value A set of cash flows is said to have a net present value or net present worth if…
Q: when considering the Basic Ideas of Finance, what is the main risk of buying or borrowing capital to…
A: When you borrow funds to invest in an asset, the funds have to be repaid with Interest.…
Q: A forest products company owns a 1,000-acre tract of forest land which has a total of 200,000 tons…
A: a. If the real interest rate is 3 percent per year, the company should do clear-cutting. The future…
Q: Mortgage payments Principal: $180,000.00 Interest Monthly Rate Payment 3.5% 5% 6% A. $347,760 C.…
A: STEP 1 The amount that is deducted from your outstanding loan balance is known as the principal…
Q: Investor has had the following returns in the Magic Fund for the past 4 years: 15%, 25%, -30%, 18%.…
A: The four years returns are 15%,25%,-30%, and 18%.
Q: We have a set of 8000 data points representing bank customers' behavior over the past year (each…
A: The confidence of an association rule is a measure of the strength of the relationship between the…
Q: a-1. What is the NPV of each project if the discount rate is 10%? (Do not round intermediate…
A: NPV is the discounted value of future cash inflows. NPV is calculated by discounting the cash…
Q: Question 2 A loan of $5400.00 was repaid together with interest of $1570.00. If interest was 12.4%…
A: NPER is the excel function used to calculate the time period.
Q: A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a…
A: Step 1: Calculation of standard deviation on portfolio The equation for the CAL is E (rc ) = r F…
Q: 2. A father plans to invest P350,000 on his son's birth for his son's education 7 years later. If he…
A: Interest rate: It represents the rate that is charged on the loan or the rate at which the deposit…
Q: The spot rate of the dollar is SF1.2948/$. The month forward contract for the Swiss franc i quoted…
A: The discount or premium on the forward contract depends on the demand and supply of currency in the…
Q: Last year, Crystal Rock Holdings reported $510,000 of sales, $262,500 of operating costs other than…
A: The times-interest-earned ratio is a financial ratio that represents the ability of a company to…
Q: Suppose you are given a choice of the following two securities: (a) an annuity that pays $10,000 at…
A: STEP 1 Investments that provide payments over a specific period of time are called annuities.…
Q: Derek borrows $38,457.00 to buy a car. He will make monthly payments for 6 years. The car loan has…
A: The implied value of an asset based on an expected discount rate at a given future date is known as…
Q: Question 29 A borrower is borrowing $300,000 with a 30 year term, monthly payments, and has the…
A: The effective borrowing cost refers to the actual interest rate that the borrower pays for borrowing…
Q: Kent owes $38000 with an interest rate of 4% in the student loans. If the loan will be paid after 2…
A: If the loan is a bullet loan that has to be paid at the end in a single payment then, the interest…
Q: Tommy Tutone is buying a $250,000 house and facing $6,500 in closing costs. He plans to put 20% down…
A: Amortization table In a table known as a loan amortization schedule, each periodic loan payment that…
Q: 2. Does the company have enough cash and liquidity to survive an economic slowdown? Enhance the…
A: Given that at the end of 2022, the company has $300 mullion in cash in spite of a loss of $504…
Q: An investment offers $9,200 per year for 17 years, with the first payment occurring one year from…
A: STEP 1 Given a specific rate of return or discount rate, an annuity's present value (PV) is the…
Q: The December 31, 2018, balance sheet of Whelan, Inc., showed long-term debt of $1,435,000, $147,000…
A: Operating cash flows The amount of cash created by a company's regular business operations is…
Q: (1) Determine the efficient amount of investment. (ii) Suppose that there is no contract and the two…
A: “Since you have posted a question with multiple sub parts, we willprovide the solution only to the…
Q: Karen’s Diner has provided the following financial information: cash and marketable securities =…
A: Working capital is the amount of capital or funds to be used in day to day operations in business.…
Q: You will receive a cash payment of $7072 in 7 years. If the relevant interest rate is 19.89%, how…
A: Time Value of Money states that a dollar earned today is more valuable than any time in the future,…
Q: 2 c. If the starting salary for a H.S. History teacher is $42,000 in Greeley, based on the cost of…
A: As per instructions question 1.C will be attempted. CPI stands for Consumer Price Index. It is an…
Q: Mark is the owner of the restaurant Mark's on the Park. At the beginning of the year, Mark had…
A: Net Income is the only factor that can affect Owner's Equity besides if owner adds more money into…
Q: mtio Calculations Select the images below to enlarge. Balance Sheet Murawski Company Balance Sheet…
A: The current ratio represents the ratio between current assets and current liabilities of company and…
Q: Edelman Engines has $18 million in total assets. Its balance sheet shows $2 million in current…
A: Total Assets =$ 18 Million Current Liabilities =$ 2 Million Long term debt =$ 10 Million Common…
Q: What is the impact of cryptocurrency on the economy? Explain thoroughly.
A: Cryptocurrencies are digital or virtual tokens that use cryptography to secure and verify…
Q: Investment X offers to pay you $4,700 per year for 9 years, whereas Investment Y offers to pay you…
A: Net Present Value - It is the difference between the present value of cash outflow and present…
Q: A European candy manufacturing plant manager must select a new irradiation system to ensure the…
A: The process through which an entity/individual analyze and evaluate a project/investment's…
Q: Find the payment necessary to amortize a 12% loan of $2300 compounded quarterly, with 12 quarterly…
A: PMT stands for "payment." In finance and accounting, PMT refers to a fixed payment amount made by a…
Q: Investor is considering using semi-variance instead of variance. State the argument in favour of…
A: Variance is a measure of how far a set of numbers are spread out from their average. It is…
Q: How is net worth calculated?
A: Net Worth: The value of a person or corporation is their net worth.It can be applied to…
Q: 4 Horizontal and Vertical Analysis DIRECTIONS: Using these data from Rollaird Company's comparative…
A: Vertical analysis is one of the financial statement analysis under which each balance sheet item is…
Q: What are the sources of gains for bondholders Interest payments Dividends Stock split Capital gains
A: Bondholders An investor or the owner of debt instruments, which are frequently issued by…
Q: Suppose that the index model for two Canadian stocks HD and ML is estimated with the following…
A: STEP 1 Systematic risk is a risk associated with the overall market, whereas unsystematic risk is a…
Q: We expect a perpetuity of quarterly cash flows of $80,000 starting in 1 quarter. Given a discount…
A: A perpetuity is a series of continuous payments occurring at equal intervals that go on forever. The…
Q: You own 1,000 shares of stock in Avondale Corporation. You will receive a $3.45 per share dividend…
A: Any stock's market value indicates the current worth of all the expected cash flows from the stock.…
Q: Suppose Wacken, Limited, just issued a dividend of $1.93 per share on its common stock. The company…
A: Stock valuation is a process in which all the expected dividends are discounted to its present value…
Q: A major manufacturer is reevaluating its bonds since it is planning to issue a new bond in the…
A: A bond is a debt instrument that obligates its issuer to pay a regular fixed periodic payment along…
Q: What will happen to Big Moon’s total expected return and overall risk if the proposed new branch…
A: Whenever a new investment is added, the return and risk change or the overall investment or project.…
Q: Pakar & Son Sdn Bhd is looking to invest in a new project, with a project life of 4 years. The…
A: The initial cost of the project refers to the cash that has been incurred in the beginning to set up…
Q: Both a call and a put currently are traded on stock XYZ; both have strike prices of $60 and…
A: The Strike price is $60. The option price for the call is $5. The option price for the put is %7.
Q: Seamus has made deposits of $84 into his savings account at the end of every month for 20 years. if…
A: STEP 1 Effective Rate The return on an investment or the amount of interest owing on a loan, when…
Q: A European candy manufacturing plant manager must select a new irradiation system to ensure the…
A: In annual equivalent method we try to find annual equivalent benefits from the projects and select…
Q: Suppose an investor shorts a straddle (a call option + a put option with the same strike price) with…
A: We can use the Black-Scholes formula to calculate the theoretical values of the call and put options…
Q: Collowing CIS suma working project. Add 10% to your computed figure to allow for contingencies.…
A: Working capital is a balanced amount available that is used to meet the current obligations of the…
Q: A brand had a 20% dollar share at 12/31/20 and a 18% dollar share at 12/31/21. Additionally, the…
A: Unit velocity is a metric used to measure the rate of sales growth per unit of production. It…
Q: You need $4,000 to buy a new baking oven for your business in 4 years. What value you must have now…
A: Hi student Since there are multiple questions, we will answer only first question. Interest is the…
Step by step
Solved in 3 steps
- P.nil Calculate the accrued interest (in $) and the total purchase price (in $) of the bond purchase. (Round your answers to the nearest cent.) Company Coupon Rate Market Price Time Since Last Interest Accrued Interest Commission per bond Bonds Pur. Total Price Company 2 9.7 79.75 23 days ? $9.95 15 ?B. Complete the information below using Bonds. Redemption Value (F) Conversion per year (m) Bimonthly Coupon Payments (k) Bond Rate (r) 11. 18% P7.50 P680 Quarterly 11% 12. P900 Quarterly 12.8% 13. P1,300 Bimonthly 12% 14. 15. Annually 15% P105.00What is assumed the be the face value aka par value aka principal aka loan amount of a bond? It's also assumed to be a bond's FV. 10% $0 $100 $1,000
- The Excel file Immunization Using Individual Bonds contains information about three bonds. Use this data to: Yield to maturity (Expected/Current) 7% Number of Years to Future Liability 8 Future Liability $ 3,000.00 Bond 1 Bond 2 Bond 3 Coupon rate 8.00% 9.000% 7.00% Maturity 9 24 15 Face value 1,000 1,000 1,000 Explain which bond you prefer to use to attempt to immunize this obligation which is due in 8 years. Analyze each bond’s performance in attempting to achieve immunization Please show work in excel and functions/equations used.Calculate the total annual interest, total cost, and current yield for the bond. (Round the "Current yield" to the nearest tenth percent and other answers to the nearest whole dollar.) Number of bonds Total annual Bond Selling price Total cost Current yield purchased interest Wang 6 1/2% 26 4. 68.125 % 96 Prev 9 of 18 Next > M1. Calculate the total annual interest, total cost, and current yield for the bonds. (Round the"Current yield" to the nearest tenth percent and other answers to the nearest whole dollar.)Bond Number of bonds purchased Selling price Total annual interest Total cost Current yieldMuni 5 22 6 81.375 $ $ %
- Would you please help me understand how you got 16 for semiannual periods (number of period)? Bond premium amortised = Total bond premium ÷ Number of period = $407,830 ÷16 semiannual periods = $25,489 (Rounded to the nearest dollars).please question D and E is required. Bond Consider a bank with the following balance sheet (M means million): Assets Value Duration of the Asset Convexity of the Asset 5yr bond bought at a yield of 3.4% (lending money) $550M 4.562 12.026 12yr bond bought at a yield of 4% (lending money) $800M 9.453 53.565 Liabilities Value Duration of the Liability Convexity of the Liability 2yr bond sold at a yield of 2.4% (borrowing money) $300M 1.941 2.384 4yr bond sold at a yield of 2.8% (borrowing money) $500M 3.759 8.206 a) Calculate the equity (total asset – total liability) to asset ratio of the bank (Hint: equity to asset ratio = total equity/total asset) b) Calculate the duration and convexity of the both asset and liability sides; c) If the interest rates go up by 1%, using the duration and convexity rule to determine the net worth of the bank and the equity to asset ratio; d) In c)’s…b. The interest payment on June 30, 20Y2, and the amortization of the bond premium, using the straight-line method. Round to the nearest dollar. Interest Expense Premium on Bonds Payable v Cash V Feedback V Check My Work The straight-line method of amortization provides equal amounts of amortization over the life of the bond. 3. Determine the total interest expense for 20Y1. Round to the nearest dollar. 2$ 4. Will the bond proceeds always be greater than the face amount of the bonds when the contract rate is greater than the market rate of interest? Yes 5. Compute the price of $27,440,791 received for the bonds by using the present value tables in Appendix A. Round your PV values to 5 decimal places and the final answers to the nearest dollar. Your total may vary slightly from the price given due to rounding differences. Present value of the face amount 2$ Present value of the semi-annual interest payments Price received for the bonds
- An investor gathers the following data on three newly-issued bonds: 1-year government bond, 3.0% yield 1-year ABC corporate bond, 4.2% yield 10-year government bond, 3.8% yield If investors require a 0.5% liquidity premium for corporate bonds, what are the components of the required return on a 10-year ABC bond?Calculate the accrued interest (in $) and the total purchase price (in $) of the bond purchase. (Round your answers to the nearest cent.) Market Price Time Since Last Accrued Interest Commission Coupon Rate Bonds Purchased Total Price Company per Bond Interest Company 2 9.8 79.75 23 days $ 6.26 $9.35 15 $ 1149.9Q4. A long term bond with a face value of $10,000 has a bond interest rate of 6% per year pay: quarterly. What are the amount of the interest payments? (a) $160 (b) $150 (c) $170 (d) $155 (e) your answer (... ......)