Bond yield to bond coupon maturity rating maturity

Assignment Help Financial Management
Reference no: EM131011091

A $1,000 par corporate bond with a coupon of 5% that pays interest semiannually is currently selling for $1,040. The current rate of return or current yield on this bond is

A: 2.4% B: 2.5% C: 4.0% D: 4.8% E: 5.0%

Each of the following four corporate bonds is currently selling at a discount:

Bond Yield to Bond Coupon Maturity Rating Maturity A 5.2% 5 years AA 6.0% B 5.2% 10 years B 7.0% C 5.0% 15 years AA 6.0% D 4.8% 5 years AAA 5.8%

Jill is considering investing in corporate bonds, but she is concerned about maintaining her principal over her 5-year time horizon. She anticipates market interest rates to increase over the next several years. The best choice for Jill is to invest in

A: Bond A B: Bond B C: Bond C D: Bond D E: Either Bond A or Bond

Linda lives in New York City and pays 8% in local and state taxes and 30% in Federal income taxes. Her time horizon is about four years, and Linda is concerned with maximizing her return. Linda is considering the following bond investments that each have similar ratings and commissions:

Bond Type     Yield A NY State    5.3% B Virginia State Bond   5.6% C Corporate Bond   8.2%

Based on the above information, Linda’s best choice is

A: Bond A B: Bond B C: Bond C D: Either Bond A or Bond B since they are both municipals E: Linda’s time horizon is too long to be investing in bonds

Reference no: EM131011091

Questions Cloud

About the operating cycle : Aviva Technology’s operating cycle is 93 days. Its inventory was $121,240 at the end of last year, and the company had a $1.0 million cost of goods sold. How long does it take Aviva to collect its receivables on average? (Round intermediate calculati..
Description of the theories including the key components : Provide the following information based on the theories: A description of the theories including the key components and Describe at least one therapeutic technique that can be used with a child or adolescent using the the two theories
Budget actual current monthly salary before tax : Budget profile for a medical Resident monthly Budget Actual Current Monthly salary before tax $5,000 Retirement deduction before taxes $350 pretax contribution $300 Housing $900 utilities $70 $65 Food $700 $500 Gas $125 $100 Car payment $400 cell pho..
Verbal and performance measures in intelligence testing : What are the differences between verbal and performance measures in intelligence testing? Compare and contrast using examples. What are the influences of language, culture, and education on popular measures of intelligence
Bond yield to bond coupon maturity rating maturity : A $1,000 par corporate bond with a coupon of 5% that pays interest semiannually is currently selling for $1,040. The current rate of return or current yield on this bond is. Bond Yield to Bond Coupon Maturity Rating Maturity A 5.2% 5 years AA 6.0% B ..
Deposited in a savings account : You deposited $11175 in a savings account that pays 9.24 percent interest, compounded quarterly, planning to use it to finish your last year in college. Eighteen months later, you decide to go to the Rocky Mountains to become a ski instructor rather ..
The osi model is a reference model : Data Link layer: Provides an interface with the network adapter; maintains logical links for the subnet
Identify the federal guidelines-statutory : Identify the federal guidelines-statutory, case law, and American Psycological Association (APA)-for psychological tests. Describe some of the cases influential in bringing about the federal government's involvement in the use of tests in the forens..
Write a c program that outputs a table of values of t : Write a C program that outputs a table of values of t and l!C , The user enters the range of time desired in seconds and the incre­ ment in fractions of a second, the source current Us) in amperes, the resistance (R) in ohms, the initial voltage ..

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