Calculate the current market price of bond

Assignment Help Finance Basics

Reference no: EM1367019

Omega or Alpha Limited sold a Preferred stock issue three years ago. This Preferred stock has a maturity twenty years from its issue date and pays a $3.00 annual dividend which provides a 12% to its original investors. Since this Preferred stock was sold interest rates (our old friend krf) have increased, and if O / A were to sell like Preferred stock today it would carry a 15% return to its original investors.

Calculate the current market price of this issue of O / A's Preferred stock.

Reference no: EM1367019

Questions Cloud

Continuum of managed care models : Explain how the continuum of managed care models helps to understand the level of control for access, quality, and costs for each type.

Impact of meals on world-ecological and economic perspective : Write about the impact that two (2) of your meals have on our world from an ecological and economic perspective.

Leadership qualities : As a leader, you will often have to take risks. Explain the leadership qualities a leader must have to lead successfully at such times.

Determining sources of economic profit : How do the concepts of accounting profit and economic profit differ? Why is economic profit smaller than accounting profit? What are the three basic sources of the economic profit? Classify each of following according to those sources:

Calculate the current market price of bond : Omega or Alpha Limited sold a Preferred stock issue three years ago. This Preferred stock has a maturity twenty years from its issue date and pays a $3.00 yearly dividend

Healthcare industry through three levels of care : A patient consists of a brain tumour and you must trace his or her interaction with the Healthcare industry via the three levels of care.

Stockpiled lobster-price elasticity : Describe the effect of increase from 1998-1999. How would the increase in demand affect the price? How would the price effect depend upon the price elasticity of supply? Please describe how. (Explain the illustration instead of actually drawing it)

Create a class-how to cash goods-give change to customers : Write class called Cashier that directs a cashier how to cash goods and give change to customers. Typical cashier operations are as follows.

Calculate the current value of the bond : Due to a number of lawsuits related to toxic wastes, major chemical producre has recently experienced a market revaluation. The company has a bond issue outstanding with fifteen years to maturity and a coupon rate of 8 percent,

User Account

All Pages