Consider zero-coupon bond with face value

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1. A company reported the following for a given year: Sales = $5,600,000; Expenses = $3,000,000; Depreciation = $190,000; Interest Expense = $80,000. If the corporate tax rate is 35 percent, calculate the company's net income for that year.

A. $1,638,000 B. $2,330,000 C. $1,566,500 D. $1,514,500

2. Consider a zero-coupon bond with face value of $1,000 and 5 years to maturity. The bonds yield to maturity is 9%. What is its duration?

a. 9.00

b. 1.09

c. 1.90

d. 5.00

Please show the process

Reference no: EM131950097

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