Bonds would have greatest percentage increase in value

Assignment Help Financial Management

Reference no: EM13875964

Which of the following bonds would have the greatest percentage increase in value if all interest rates in the economy fall by 1%?

1. 10-year, zero coupon bond.

2. 1-year, 10% coupon bond.

3. 20-year, zero coupon bond.

4. 20-year, 5% coupon bond.

5. 20-year, 10% coupon bond.

Reference no: EM13875964

Questions Cloud

Prepare an explanation of the difference in operating income : Prepare a reconciliation and explanation of the difference in the operating income resulting from the full- and variable-costing methods.

If the fed wants to increase the money supply : If the Fed wants to increase the money supply, it should:

What is the present value of this stock at a discount rate : Bittles, Inc. just paid an annual dividend of $2.50 a share. The dividend will increase by 40 percent for the next two years and then increase by 4 percent annually thereafter. What is the present value of this stock at a discount rate of 6 percent?

What would be the dollar value of depreciation your company : On February 22, 2009, your company bought office furniture for $35,000. According to the accounting rules everyone must play by, what would be the dollar value of depreciation your company could take in the following years assuming they use MACRS and..

Bonds would have greatest percentage increase in value : Which of the following bonds would have the greatest percentage increase in value if all interest rates in the economy fall by 1%?

Is it possible to speak of ethnic groups in america : Is it possible to speak of ethnic groups in America in terms other than stereotypes?

Compute volume of admissions required for nursing home : A nursing home presents the following revenue and expense information – Number of admissions: 8,000 Average Revenue per admission: 10,000 Variable Cost per admission: 2,000 Given that the nursing home's fixed costs are $40 million: What is the nursin..

Prepare a plan to present your idea to your supervisor : Explain why you think this idea will benefit the business in terms of return of investment (ROI). Prepare a plan to present your idea to your supervisor covering the following items: Create a vision of your idea that explains the value to the company

What is their yield to maturity : Dylon Corp.'s bonds currently sell for $1,180 and have a par value of $1,000. They pay a $60 annual coupon and have a 15-year maturity, but they can be called in 5 years at $1,100. What is their yield to maturity (YTM)?

User Account

All Pages