Value zero-coupon bond that matures

Assignment Help Financial Management

Reference no: EM131943168

1. What is the current value of a zero-coupon bond that pays a face value of $1,000 at maturity in 9 years if the appropriate discount rate is 5%.

2. What interest rete is implicit in a $1,000 par value zero-coupon bond that matures in 6 years if the current price is $580

Please specify your answer in decimal terms and round your answer to the nearest thousandth.

3. True or False. Provide at least five sentences of Explanations or calculation. An investor purchased an NCD a year ago in the secondary market for $985,000. He redeems it today and receives $1,000,000. He also receives interest of $38,000. The investor's annualized yield on this investment is 5.38%.

Reference no: EM131943168

Questions Cloud

What yield on gm bonds would make weston treasurer : Barth Corporation has some money to invest, and its treasurer is choosing between General Motors bonds and State of Illinois bonds.

Future capital budgeting projects : The firm has no preferred stock on its balance sheet and has no plans to use it for future capital budgeting projects.

Explain three economic disincentives : Explain three economic disincentives that probably dampen the flow of funds between household savers of funds and corporate users of funds

How management should address the problems : Based on the company you researched in the e-Activity, assess the financial "red flags" that would have indicated that the company may be having financial.

Value zero-coupon bond that matures : What interest rete is implicit in a $1,000 par value zero-coupon bond that matures in 6 years if the current price is $580

Calculate the total cost of the seasoned equity : Calculate the total cost of the seasoned equity offering to RPC's existing stockholders as a percentage of the offering proceeds.

Evaluate the cost of new equity using given data : Banyan Co.'s common stock currently sells for $44.50 per share. The growth rate is a constant 9.6%, and the company has an expected dividend yield of 6%.

How much of the total dividend paid by the company : Suppose the Gingridge pays a dividend per share of $3.50. How much of the total dividend paid by the company to Barry will he get to keep?

What is the flotation cost adjustment : What is the flotation cost adjustment that must be added to its cost of retained earnings? Round your answer to 2 decimal places.

User Account

All Pages