Periodic receipts of interest by the bondholder

Assignment Help Financial Management

Reference no: EM132005888

1. Periodic receipts of interest by the bondholder are known as:

a. the coupon rate

b. a zero-coupon

c. coupon payments

d. the default premium

Explain

2. Consider a 3-year bond with a par value of $1,000 and an 89% annual coupon. If interest rates change from 8 to 6% the bond's price will:

a. Increase by $51.54

b. Decrease by $51.54

C. Increase by $53.46

D. Decrease by $53.46

Show work/Explain

Reference no: EM132005888

Questions Cloud

Does the required return determine if portfolio is growth : Does the required return determine if the portfolio is growth, balanced, or aggressive - Or is it the standard deviation (risk)?

The machine that has the lowest equivalent annual cost : When we compare assets with different lives, we should select the machine that has the lowest equivalent annual cost.

Expect constant-growth rate : A company with a return on equity of 15% and a plowback ratio of 60% would expect a constant-growth rate of:

Does subliminal advertising work : Does subliminal advertising work? Provide three examples and discuss when and how they are used.

Periodic receipts of interest by the bondholder : Periodic receipts of interest by the bondholder are known as:

Increase in tax rates will tend to reduce trade deficit : Other things equal an increase in tax rates will tend to reduce the trade deficit.

The sale of computers to argentina is credit : The sale of computers to Argentina is a credit in the U.S. current account.

What is the bond coupon rate : Suppose a five-year, $1,000 bond with annual coupons has a price of $901.51 and a yield to maturity of 6.4%.What is the bond's coupon rate?

Dollar price of the euro represents appreciation of dollar : An increase in the dollar price of the euro represents an appreciation of the dollar.

User Account

All Pages