The bond equivalent yield and the effective annual return

Assignment Help Financial Management
Reference no: EM13806701

A Treasury bill with 136 days to maturity is quoted at 96.012. What is the bank discount yield, the bond equivalent yield, and the effective annual return? (Do not round intermediate calculations. Enter your answers as a percent rounded to 3 decimal places. Omit the "%" sign in your response.)

Discount yield   %

Bond equivalent yield   %

Effective annual return   %

Reference no: EM13806701

Questions Cloud

What is the yield to maturity for these bonds : Atlantis Fisheries issues zero coupon bonds on the market at a price of $415 per bond. Each bond has a face value of $1,000 payable at maturity in 17 years. What is the yield to maturity for these bonds?
Firms future earnings prospects is called the hypothesis : The idea that dividend changes reflect managers' views about a firm's future earnings prospects is called the ________ hypothesis. Consider the following equation: C = P + S - PV(K) - PV(Div). In this equation, what does the term K represent?
Call option-position until maturity : Suppose you purchase a call option for $5 and a strike price of $40. On the expiration day, the price of the stock is $55. What is the return on the call option if you hold your position until maturity?
Short-term cash in a particular money market investment : The treasurer of a large corporation wants to invest $44 million in excess short-term cash in a particular money market investment. The prospectus quotes the instrument at a true yield of 3.56 percent; that is, the EAR for this investment is 3.56 per..
The bond equivalent yield and the effective annual return : A Treasury bill with 136 days to maturity is quoted at 96.012. What is the bank discount yield, the bond equivalent yield, and the effective annual return? (Do not round intermediate calculations. Enter your answers as a percent rounded to 3 decimal ..
Cash management system free up : Norma’s Cat Food of Shell Knob ships cat food throughout the country. Norma has determined that through the establishment of local collection centers around the country, she can speed up the collection of payments by two and one-half days. If the com..
Agreement is called a line of credit : A company and a bank sign an agreement where the bank agrees to provide loans when the company requires them. This agreement is called a line of credit. What characteristics of the agreement and the bank will cause the company to change its payment l..
What is this firms debt-equity ratio : Zombie Corp. has a profit margin of 5.1 percent, total asset turnover of 2.3, and ROE of 19.64 percent. What is this firm’s debt-equity ratio? (Do not round intermediate calculations and round your final answer to 2 decimal places, e.g., 32.16.)
Accounts payable balance : Hare, Inc., had a cost of goods sold of $43,921. At the end of the year, the accounts payable balance was $7,943. How long on average did it take the company to pay off its suppliers during the year? (Use 365 days a year. Do not round intermediate ca..

Reviews

Write a Review

Financial Management Questions & Answers

  Annual maintenance costs associated with ownership

To finance some manufacturing tools it needs for the next 3 years, Waldrop Corporation is considering a leasing arrangement. The tools will be obsolete and worthless after 3 years. The firm will depreciate the cost of the tools on a straight-line bas..

  What would be the weight used for equity in the computation

Team Sports has 6 million shares of common stock outstanding, 1 million shares of preferred stock outstanding, and 200 thousand bonds ($1,000 par). If the common shares are selling for $24.50 per share, the preferred share are selling for $20 per sha..

  The discussion board db is part of the core of online

the discussion board db is part of the core of online learning. classroom discussion in an online environment requires

  Bonds for some much needed expansion projects

Pembroke Co. wants to issue new 20-year bonds for some much needed expansion projects. The company currently has 8 percent coupon bonds on the market that sell for $983, making annual payments, and mature in 20 years. What coupon rate should the comp..

  Cost benefit analysis

Use the cost benefit analysis to recommend to Smith whether Sun Gas should proceed will the Web based ordering system. Give your reasons, showing supporting calculations.

  What is the bonds conversion ratio and straight-debt value

Preissle Company, wants to sell some 20-year, annual interest, $1,000 par value bonds. Its stock sells for $42 per share, and each bond would have 25 warrants attached to it, each exercisable into one share of stock at an exercise price of $47. The f..

  Investment-under the payback method

Under the payback method, which of the following would be concluded?

  Real rate of interest on short-term treasury bills

You observe that the current interest rate on short-term U.S. Treasury bills is 4.23 percent. You also read in the newspaper that the GDP deflator, which is a common macroeconomic indicator used by market analysts to gauge the inflation rate, current..

  How current and projected future economic conditions

Examine how current and projected future economic conditions affected your selections for the portfolio. Discuss at least three specific, relevant economic factors.

  Cash flows be used to evaluate capital budgeting projects

Discuss how a project’s risk can be incorporated into capital budgeting analysis. Should discounted cash flows be used to evaluate capital budgeting projects?

  Find the future values of these ordinary annuities

Find the future values of these ordinary annuities. Compounding occurs once a year.Rework previous parts assuming that they are annuities due. Round your answers to the nearest cent.

  Finding the required interest rate

Your parents will retire in 20 years. They currently have $320,000, and they think they will need $2,500,000 at retirement. What annual interest rate must they earn to reach their goal, assuming they don't save any additional funds?

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