What is its duration and modified duration

Assignment Help Financial Management
Reference no: EM131520293

Your 4% coupon bond has 2.75 years (=2 years, 9 months) to maturity. The bond's price is 107.08 and YTM of 1.25%. What is its duration and modified duration? (assume 30/360 day count)

Reference no: EM131520293

Questions Cloud

What is the required after-tax refunding investment outlay : What is the required after-tax refunding investment outlay, i.e., the cash outlay at the time of the refunding?
Probable cause before they can conduct a search on school : Do you believe there would be fewer problems if schools had more freedom to search and seize illegal weapons or drugs on school grounds?
Use the modified duration to forecast the rate of return : Use the modified duration to forecast the rate of return that a bondholder will experience if interest rates immediately increase by 15 basis points.
What is net advantage to leasing in thousands : What is the net advantage to leasing (NAL), in thousands?
What is its duration and modified duration : The bond's price is 107.08 and YTM of 1.25%. What is its duration and modified duration?
Make a profit through covered interest arbitrage : Tomoko Matsubara is a currency arbitrager for Showa and company, Yokohama. How can Matsubara-san make a profit through covered interest arbitrage?
How would you measure the success of a growth project : How would you measure the success of a growth project? When would you want to short sell a stock? How do you short sell a stock?
Calculate the tax bill on the sale for the investors : Calculate the tax bill on the sale for the investors.
New smart vacuum cleaning robot project : What is/are the sunk cost(s) for this new smart vacuum cleaning robot project? Briefly Explain. What are the cash flows of the project for each year?

Reviews

Write a Review

Financial Management Questions & Answers

  How much money will the city receive from bobs generosity

(Future Value) Bob Terwilliger received $12,745 for his services as financial consultant to the mayor's office of his hometown of Springfield. Bob says that his consulting work was his civic duty and that he should not receive any compensation.

  Is this a discount or premium bond

Compute the price of a 5.4 percent coupon bond with 10 years left to maturity and a market interest rate of 8.6 percent. Is this a discount or premium bond?

  What is the price you are willing to pay for the bond

Jones Inc. issued a bond with an annual coupon rate of 10% with interest paid annually. The bond matures in 15 years. The par value of the bond is $1,000. If your required return for this type of bond is 15%, what is the price you are willing to pay ..

  What is the delta of call option with strike price

IBM stock currently sells for 84 dollars per share. The implied volatility equals 47.5 percent. The risk-free rate of interest is 4.5 percent continuously compounded. What is the delta of a call option with strike price 83 and maturity of 8 months?

  Common stocks are riskier than preferred stocks

Common stocks are riskier than preferred stocks. A "discount (or interest) point" is equal to 1% of the loan amount. In general, bonds are riskier than common stocks.

  Two projects IRRs at these same costs of capital

Your division is considering two investment projects, What are the two projects' IRRs at these same costs of capital?

  Face value commercial paper

The price of $8000 face value commercial paper is $7930 . if the annualized discount rate 4% when will the paper mature ? if the annualized investment rate % is 4% , when the paper mature

  Describe managerial problems each of three topics address

B7530- Describe the managerial problems or opportunities each of the three topics address? Provide a short description for each research topic, highlighting the problem or opportunity in organizations that needs to be addressed

  About spending your entire life working

You are not thrilled about spending your entire life working. So, you have decided that you will save $9 thousand a year, starting at the end of this year, and retire as soon as you can accumulate $1 million. If you can earn an average of 7.23 percen..

  What is the compound yield

What is the compound yield on a $10,000 three month (90 day) treasury bill that cost $9,843?

  Pay off a debt that will be coming due in one lump sum

How much should be invested at 8% annual compounded interest in order to accumulate $10,000 in year ten?

  Calculate income taxes and average tax rate

Oakdale Fashions, Inc., had $400,000 in 2015 taxable income. Use the tax schedule in Table 2.3 to calculate the company’s 2015 income taxes. Calculate: Income taxes, Average tax rate, What is the marginal tax rate?

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