Maturity has coupon rate

Assignment Help Financial Management
Reference no: EM131354482

A U.S. government T Note with a 2 year maturity has a coupon rate of 10% and a face value of $1000. the coupons are paid annually and the next coupon is due in one year. The T note's yield to maturity is 10%. What is this T note's modified duration?

Reference no: EM131354482

Questions Cloud

Project modified internal rate of return : You are considering a project that requires an initial investment of 50000. It's expected cash flows are 10000 per year for the next 6 years. The cost of capital is 10%. What is this project's modified internal rate of return?
Cost of trade credit to customers who take discount : McEwan Industries sells on terms of 3/10, net 35. Total sales for the year are $519,500; 40% of the customers pay on the 10th day and take discounts, while the other 60% pay, on average, 50 days after their purchases. What is the days sales outstandi..
Make enough money to keep up with payments : Currently, you owe the bank $16,475 on a car loan. The loan has an interest rate of 9.25 percent and monthly payments of $285. You realize that you cannot make enough money to keep up with the payments. How much longer will it take you to repay this ..
What is the most you would pay for this stock : You are planning to buy a stock and hold it for 2 years. You expect to receive $2 in dividends at the end of each year and then you expect to sell the stock after 2 years for $30. If your required return is 6%, what is the most you would pay for this..
Maturity has coupon rate : A U.S. government T Note with a 2 year maturity has a coupon rate of 10% and a face value of $1000. the coupons are paid annually and the next coupon is due in one year. The T note's yield to maturity is 10%. What is this T note's modified duration?
What is the length of the firm cash conversion cycle : Baloon Payment Financial (BPF) has an inventory conversion period 0f 45 days, and a payables deferall period of 20 days. What is the length of the firm's cash conversion cycle? If BPF's annual sales are $1.8 million and all sales are on credit, what ..
What is the expected return on the portfolio : You own a portfolio that has $2,750 invested in Stock A and $3,900 invested in Stock B. If the expected returns on these stocks are 9 percent and 14 percent, respectively, what is the expected return on the portfolio?
The market capitalization rate on the stock : The market capitalization rate on the stock of Funky Asphalt, Inc. is 8.8%. Its expected ROE is 13.4% and its expected EPS is $5.8. If the firm's plow-back ratio is 58%, what is the expected P/E ratio
Is the project without interest tax gain profitable : Entrata AS has a market-weighted target equity ratio ( "Target debt Proportion") of 40% and debt has a coupon of 3.4% per year (annual interest payment). Corporate cost of capital without debt ( "unlevered") is 7%. The company pays 25% corporation ta..

Reviews

Write a Review

Financial Management Questions & Answers

  The evening telegram states bond price

The Evening Telegram states a bond price at $97.00, while it yields is reported at 6%. If there are 7 years left to maturity on this bond, what then, is this bond's coupon? Is it $48, $50, $53, or $55?

  Calculate the cost of equity using the DDM method

Floyd Industries stock has a beta of 1.25. The company just paid a dividend of $.40, and the dividends are expected to grow at 5 percent per year. The expected return on the market is 12 percent, and Treasury bills are yielding 5.0 percent. The most ..

  What is nominal yield to maturity and nominal yield to call

A firm's bonds have a maturity of 12 years with a $1,000 face value, have an 11% semiannual coupon, are callable in 6 years at $1,214, and currently sell at a price of $1,377.14. What is their nominal yield to maturity? What is their nominal yield to..

  How much safety inventory does the store carry

Weekly demand for a popular model of HP printers at a Sam’s Club store is normally distributed, with a mean of 30 and standard deviation of 20. The store manager continuously monitors inventory and currently orders 300 printers each time the inventor..

  Describe the tax and nontax uses of transfer pricing

Describe the tax and nontax uses of transfer pricing. Describe the trigger event for US tax liability for an unconsolidated foreign subsidiary. How can tax management be used to influence cost of capital for a multinational corporation? Discuss the d..

  What is the standard deviattion of your portfolio

A pension fund manager isconsidering three mutual funds. The first is a stock fund, the second is a long-termgovernment and corporate bond fund, and the third is a T-bill money market fund thatyields a rate of 8%. what is the standard deviattion of y..

  How much money must robinson invest

How much money must Robinson invest at the end of each of the next 25 years to realize her goal of $600,000 at the end of that time?

  Bonds yield to maturity remains at its current rate

A 20-year bond with a par value of $1,000 has a 9 percent annual coupon. The bond currently sells for $925. If the bond’s yield to maturity remains at its current rate, what will be the price of the bond 10 years from now?

  Modified accelerated cost recovery system

The following facts are presented on an opportunity to invest in Machine A: Cost of equipment is $200,000. The machine has an expected 4-year useful life; it will be depreciated according to the 3-year Modified Accelerated Cost Recovery System (MACRS..

  What are types of risk that are measured by a levered beta

You are determining whether your company should undertake a new project and have calculated the NPV of the project using the WACC method when the CFO, a former accountant, notices that you did not use the interest payments in calculating the cash flo..

  Calculate the holding period return

Calculate the Holding Period Return: You invested to one of investment $45 per year last year. This year is worth $54 per share. Company also pays dividend $15 per share. What is the total return over the past year.

  Reasonable costs of capital for average-risk-high-risk

Distinguish between beta (i.e market) risk, within-firm ( i.e, corporate) risk, and stand-alone risk for a potential project. Of the three measures, which is theoretically the most relevant, and why? Suppose a firm estimates its overall cost of capit..

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