What is his irr for this investment

Assignment Help Mechanical Engineering

Reference no: EM131356453

Jerry has an opportunity to buy a bond with a face value of S10 000 and a coupon rate of 14%, payable semiannually.

(a) If the bond matures in five years and Jerry can buy one now for S3500, what is his IRR for this investment?

(b) If his ALARR for this type of investment is 20%, should he buy the bond?

Reference no: EM131356453

Questions Cloud

Calculate the err of this project : Are you sure that the ERR you calculated is the only ERR? Why ? Are you sure that your recommendation to Samiran is correct? Justify your answer.

Prepare journal entry to record the transfer on the books : The Mountain High Ice Cream Company transferred $50,000 of accounts receivable to Prudential Bank. The transfer was made without resource. Prudential Bank remits 90% of the factored amount to Mountain High and retains 10%. Prepare the journal entry t..

Alex anderson recently won lottery : Alex Anderson recently won a lottery and has the option of receiving one of the following three prizes: Assuming an interest rate of 6%, which option should Alex choose?

Prepare a lower level data flow diagram for cash receipt : Redraw the appropriate part of given Figure, assuming a lockbox system is used. Also, prepare a lower-level data flow diagram for the cash receipts function, using the same assumption.

What is his irr for this investment : Jerry has an opportunity to buy a bond with a face value of S10 000 and a coupon rate of 14%, payable semiannually.

What is the irr for this project : He knows only that the project has a five-year sendee life and a first cost of R180 000, that a set of equal cash flows occurred at the end of each year, and that the ALARR used was 10%. What is the IRR for this project?

Discuss about the contemporary psychologists : Contemporary psychologists are beginning to recognize the interconnectivity of human physiology and psychology in a way not previously understood. This is in part because of new interest in holistic health and in part because of brain/body connect..

How will your competitive approach shape your financial plan : How will your competitive approach shape your financial plan? Explain how you are adjusting your financials to accommodate your competitive strategy.

What primary functions does the ptop process perform : What primary functions does the PtoP process perform?- How, in your own words, would you define the PtoP process?

User Account

All Pages