An investor has two bonds in his portfolio

Assignment Help Financial Management
Reference no: EM131600007

Bond valuation

An investor has two bonds in his portfolio that both have a face value of $1,000 and pay a 10% annual coupon. Bond L matures in 13 years, while Bond S matures in 1 year.

Assume that only one more interest payment is to be made on Bond S at its maturity and that 13 more payments are to be made on Bond L.

What will the value of the Bond L be if the going interest rate is 4%? Round your answer to the nearest cent.

$

What will the value of the Bond S be if the going interest rate is 4%? Round your answer to the nearest cent.

$

What will the value of the Bond L be if the going interest rate is 8%? Round your answer to the nearest cent.

$

What will the value of the Bond S be if the going interest rate is 8%? Round your answer to the nearest cent.

$

What will the value of the Bond L be if the going interest rate is 12%? Round your answer to the nearest cent.

$

What will the value of the Bond S be if the going interest rate is 12%? Round your answer to the nearest cent.

$

Reference no: EM131600007

Questions Cloud

Taking on project in the capital budgeting process : How do we deal with interest expense that result from taking on a project in the capital budgeting process?
What is entry barrier that is source of the monopoly power : What is the entry barrier that is the source of the monopoly power for the following products or producers? List some competitors that keep these products.
What is the change in investment and npv of proposed change : What is the change in Investment? What is the NPV of the proposed change?
Charge the recipient of the signal : Broadcast television and broadcast radio send out signals that can be received by an infinite number of receivers without reducing the quality of the reception.
An investor has two bonds in his portfolio : An investor has two bonds in his portfolio that both have face value of $1,000 and pay 10% annual coupon.
Is given type of good normally provided by private industry : Broadcast television and broadcast radio send out signals that can be received by an infinite number of receivers without reducing the quality of the reception.
How much loss would company recognize n its income statement : Annual fixed costs are $24,000. If Rambles sells 10 units less than breakeven, how much loss would the company recognize n its income statement
Why we distinguish between convergence and harmonization : Briefly summarize the article. Do you agree or disagree with the article? Why must we distinguish between convergence and harmonization
What is net present value of this project : What is the net present value of this project if it the start-up cost is $1,713?

Reviews

Write a Review

Financial Management Questions & Answers

  Foreign company acquisition

Acquisition by a foreign company and the effects of that decision and the results of foreign exchange in Euro and the exchange rate differences.

  Financial management for profit and non profit organizations

In this essay, we are going to discuss the issues of financial management in a non-profit organisation.

  Method for estimating a venture''s value

Evaluate venture's present value, cash and surplus cash and basic venture capital.

  Replacement analysis

This document show the Replacement Analysis of modling machine. Is replacement give profit to company or not?

  Business finance task - capital budgeting

Your company is considering using the payback period for capital-budgeting. Discuss the advantages and disadvantages of this technique.

  Analysis of the investment

In this project, you will focus on one of these: the additional cost resulting from the purchase of an apple press (a piece of equipment required to manufacture apple juice).

  Conduct a what-if analysis

Review the readings and media for this unit, including the Anthony's Orchard case study media. Familiarise yourself with the Anthony's Orchard company and its current situation.

  Determine operational expenditures

Organisations' behaviour is guided by financial data. In the short term, such data will help determine operational expenditures; in the long term, historical data may help generate forecasts aimed at determining strategic plans. In both instances.

  Personal financial management

How much will you have left over each half year if you adopt the latter course of action?

  Sources of finance for expansion into new foreign markets

A quoted company is considering several long-term sources of finance for expansion into new foreign markets.

  Long term financial planning

This assignment is designed for analyze Long term financial planning begins with the sales forecast and the key input in the long term fincial planning.

  Explain the role of fincial manager

This assignment explain the role of fincial manager, function of manger. And what are the motives of financial manager.

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