What is the appropriate price of the bond

Assignment Help Financial Management
Reference no: EM131990551

The bond costs $900 and will pay you $1000 when it matures in 10 years! The current yield is 5%. What is the YTM of this bond? What is the appropriate price of the bond, if the current YTM on similar bonds is 4.4%?

If you save $500 per month for 45 years, how much can you accumulate? Assume monthly compounding and that you can earn 9%, on average, on your investments.

If you believe you need $3 million to retire, how long will it take you to achieve this milestone if you save $5,000 per year at a 9% rate of return?

Reference no: EM131990551

Questions Cloud

Determine a framework to base your lessons learnt : Determine a framework to base your lessons learnt on. In practice, lessons learnt discussions are framed to illicit learnings from participants.
Explain most important suggestions from the plan you select : Prepare a 2-page paper on three or four of the most important suggestions from the plan you select.
What should be done about various incidents : Your boss asks what you think about all of the strange incidents. Respond and be sure to provide recommendations on what should be done about various incidents.
What do you think of Tony Hsieh approach to hiring employees : What do you think of Tony Hsieh's approach to hiring and retaining employees? How does it fit in with your view of motivation
What is the appropriate price of the bond : What is the YTM of this bond? What is the appropriate price of the bond, if the current YTM on similar bonds is 4.4%?
Preferable to conservative investor seeking to avoid risk : Which stock would be preferable to a conservative investor seeking to avoid risk? Why?
How analytics and cloud technology could align with company : Analytics-as-a-Service is a new delivery model that uses cloud technology to provide business insights without enormous infrastructure enhancements.
What evidence can you find to support your opinion : Which CEO-Jobs or Cook-do you think developed and executed the most effective strategic plan? What evidence can you find to support your opinion?
Consider annual coupon bond with face value : Consider an annual coupon bond with a face value of ?$100?, 9 years to? maturity, and a price of ?$85.

Reviews

Write a Review

Financial Management Questions & Answers

  Differences in the reports prepared for upper management

Discuss the differences in the reports prepared for upper management compared to the reports prepared for lower-level managers.

  What are the total principal and interest payments on loan

What are the monthly payments, assuming zero down, and a thirty year mortgage? What are the total principal and interest payments on this loan?

  Borrowing rates affect the calculation of the nal

How does the fact that the lessor and lessee have different borrowing rates affect the calculation of the NAL?

  Explain the limitations of financial statements

Analyze the different ways financial statements are used by an entrepreneurial firm. Evaluate financial statements to understand liquidity, solvency, and profitability issues related to the entrepreneur. Explain the limitations of financial statement..

  Provide an accept-reject decision for capital budgeting tool

Using the above cash flows, calculate the following for each project. Assume a 11% required return a. NPV b. Payback Period c. Discounted Payback Period d. IRR e. MIRR. Assuming independent projects, provide an accept/reject decision for each capital..

  Evaluate the performance of the industrials sector

You want to evaluate the performance of the Industrials sector of your portfolio over the past year.

  How much should you be willing to pay for stock

If you require a 15 percent rate of return, how much should you be willing to pay for this stock?

  What is the company total market value of debt

What is the company’s total market value of debt? What is your best estimate of the aftertax cost of debt?

  Does the bank have adequate capital

Assume that a bank has core capital of $1,000,000 and total capital of $2,000,000. Its total risk adjusted assets are $25,000,000 and total assets are $30,000,000. - does the bank have adequate capital?

  Considering the risk around the cost point estimate

Considering the risk around the cost point estimate, what type of contract will generally be used for the contracted effort?

  What are the tax consequences on the dividends

Jo purchased 375 shares of a no-load stock mutual fund. During the year she received $3 per share in dividend distributions. What are the tax consequences on the dividends after the first year if Joe is in the 33% marginal tax bracket?

  Calculate the equity risk premium for each quarter century

Shows average return on U.S. stocks and bonds for 25-year periods ending in 1925, 1950, 1975, and 2000.- Calculate the equity risk premium for each quarter century. What lesson emerges from your calculations?

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