How much will the bond be worth

Assignment Help Finance Basics
Reference no: EM132403297

You own a bond issued by the CP railroad that promises to pay the holder $100 annually forever. You plan to sell the bond three years from now. If similar investments yield 6 percent at that time, how much will the bond be worth?

Reference no: EM132403297

Questions Cloud

What is the company wacc component cost of equity : The firm's marginal tax rate is 40%. What is the company's WACC component cost of equity (rs)?
Present value of choices : Using a discount rate of 5%, based on present value, what are the dollar values of choices A and B? Assume the person does not need the funds
Calculate the price of coupon bonds : a) Calculate the price of these 9.17% coupon bonds. b) State and explain whether these bonds are premium or discount bonds.
What is the company current stock price : Constant growth dividend: A company is expected to pay a dividend of $2 next year (D1 = $2). It has a constant growth rate of 6% and a required return
How much will the bond be worth : You plan to sell the bond three years from now. If similar investments yield 6 percent at that time, how much will the bond be worth?
What is its yield to maturity : Levi Strauss & Company has an outstanding B-rated bond that has a coupon rate of 12.25%, a face value of $1000 and is currently priced at $1117.50.
How much would you pay for abc stock : How much would you pay for ABC stock based on this information?
Net present value-payback-internal rate of return : Management of Franklin Mints, a confectioner, is considering purchasing a new jelly bean-making machine at a cost of $312,500.
Find the annual after-tax cost of debt for bonds : Marginal corporate income tax rate is %34. Find the annual after-tax cost of debt for these bonds.

Reviews

Write a Review

Finance Basics Questions & Answers

  How much of the first loan payment is interest

You just acquired a mortgage in the amount of $249,500 at 6.75 percent interest, compounded monthly. Equal payments are to be made at the end of each month for thirty years. How much of the first loan payment is interest?

  Affect the frequency of b and b over time

Describe how the introduction of an herbivore that only eats narrow leaves would affect the frequency of B and b over time.

  Monthly amount of mortgage payment

Mortgage payments are made monthly. What is the monthly amount of your mortgage payment

  What does the ratio tell about each companies

Additional problem: Observe the sales-to-net property, plant, and equipment ratios for the same year for American Airlines (1.258), Oracle Corporation (10.338).

  Calculate taxable equivalent yield for your client

Your client purchased Main municipal bond that has 9.33% municipal bond yield. Federal tax bracket is 33%. Calculate Taxable Equivalent Yield for your client.

  What will the population be 10 years from now of middletown

Middletown, USA currently has a population of 1.5 million people. It has been one of the fastest growing cities in the nation, growing by an average of 4% per year for the last five years. If this city's population continues to grow at 4% per year, w..

  Calculate the yield to maturity

A 20-year, 10% coupon bond is currently quoted at $850. Calculate the following: Yield to call, if the bond is called 10 years later at a call price equal.

  Examine what profit margin must the firm achieve

Dante Co. wishes to maintain a growth rate of 10.6 percent a year, a debt-equity ratio of 1.1, and a dividend payout ratio of 22 percent.

  To help finance a major expansion castro chemical company

to help finance a major expansion castro chemical company sold a noncallable bond several years ago that now has 20

  Compute the earnings per share for the current year

Earnings per share in the prior year was $8.00. Use the earnings per share computed in (a) and present a two-year earnings per share comparison for the current year and the prior year.

  What are examples of distributors adding value

Remember that a key part of your distribution channel strategy and selection process is how the distributor can add value to the process.

  Running a profitable business

It appears that George is running a profitable business. George is aware you are in an MBA Managerial Finance class and comes to you for advice on his working capital practices. More specifically George asks you to do the following:

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