Required rate of return on bonds of this risk level

Assignment Help Financial Management

Reference no: EM131835448

The ABC company bond has an annual coupon rate of 5.50%, pays interest semi-annually and has a face value of $1,000. If there are 22 years to maturity and your required rate of return on bonds of this risk level is 6.50%, what is the bonds value to you? show work. (with this problem solve for its present vaule and show all work with the formula).

Reference no: EM131835448

Questions Cloud

What type of shock could cause a currency depreciation : In our basic model, a rise in money growth causes currency depreciation: We also know monetary policy that a rise in money growth normally raises aggregate.

Music are used to pay interest and principal on bonds : With celebrity? bonds, celebrities raise money by issuing bonds to investors. The royalties from sales of music are used to pay interest and principal on bonds.

How commitment can make easier to keep inflation : We said that "an effective peg requires a very serious commitment to a high level of monetary and fiscal stability." As in our discussion of monetary policy.

What is the profitability index for each project : hat is the IRR for each project? What is the profitability index for each project?

Required rate of return on bonds of this risk level : If there are 22 years to maturity and your required rate of return on bonds of this risk level is 6.50%, what is the bonds value to you?

What will happen to official reserve account supply of atons : A supply-and-demand model can illustrate the difficulty of keeping a fixed exchange rate: It's much the same as any other price floor.

What will do to the Ecuadorean banking system : Ecuador is currently dollarized: Bank accounts are denominated in U.S. dollars, for example. If Ecuadoreans believe rumors that the country is going to go.

What is the before-tax cost of debt for olympic : Olympic Sports has two issues of debt outstanding. What is the before-tax cost of debt for Olympic? What is Olympic's after-tax cost of debt?

What are the sources of cash in a statement of cash flows : What questions about cash are answered by the statement of cash flows? Distinguish among the three activities reported in the statement of cash flows.

User Account

All Pages