What is the implicit interest in the first year

Assignment Help Finance Basics
Reference no: EM132345627

Suppose you purchase a zero coupon bond with a face value of ?$1,000?, maturing in 22 ?years, for ?$213.35. Zero coupon bonds pay the investor the face value on the maturity date. What is the implicit interest in the first year of the? bond's life?

The implicit interest in the first year of the? bond's life is ?$? ?(Round to the nearest? cent.)

Reference no: EM132345627

Questions Cloud

What is the ytm of the bond : The bond has a coupon rate of 6.75 percent and matures in 21 years. If the bond makes semiannual coupon payments, what is the YTM of the bond?
What is the current yield : A bond that pays interest semiannually has a price of $981.45 and a semiannual coupon payment of $28.50. If the par value is $1,000, what is the current yield?
What is the market price per bond if the face value : The bonds mature in 6 years. What is the market price per bond if the face value is $1,000?
What is the incremental savings of buying the valves : What is the incremental savings of buying the valves? (answer should be in per unit format and is a positive number)
What is the implicit interest in the first year : Zero coupon bonds pay the investor the face value on the maturity date. What is the implicit interest in the first year of the? bond's life?
Address the key issues : What are some ways that those saving for retirement can help address the key issues you have discussed?
Calculate the npv for the capital budgeting proposal : Calculate the NPV for the following capital budgeting proposal: $100,000 initial cost for equipment, straight-line depreciation over 5 years to a zero book
Decision sciences department next semester : In choosing four electives from the dazzling array offered by the Decision Sciences Department next semester, the students that had already
What is the value of the stock : The stock promised to pay an annual dividend equal to 11.0% of the par value. If the appropriate discount rate for this stock is 19.0%.

Reviews

Write a Review

Finance Basics Questions & Answers

  Compare the costs and benefits of these two checking account

A regular checking account with a monthly fee of $6 when the balance goes below $300.

  What is the concern of chapter 11 of the bankruptcy

What is the concern of Chapter 11 of the Bankruptcy Reform Act of 1978? How is the debtor in possession (DIP) involved in (1) The valuation of the firm, (2) The recapitalization of the firm, and (3) The exchange of obligations using the priority rule..

  What is the future value of prize of florida lottery

The Florida lottery agrees to pay the winner $247,000 at the end of each year for the next 20 years. What is the future value of this prize if each payment is put in an account earning 0.08?

  What is bad debt expense for 2013

Determine the amount of accounts receivable written off during 2013.

  A treasury bond that matures in 10 years has a yield of 6 a

a treasury bond that matures in 10 years has a yield of 6. a 10-year corporate bond has a yield of 7. assume that the

  Calculate the price of a fifteen-year annual coupon bond

Calculate the price of a 15-year 4 percent annual coupon bond. Assume the market is yielding 5 percent on similarly risky instrument. Please show your work and explain why this is a premium or a discount bond.

  Calculate your total based on the number of shares

Calculate your total based on the number of shares and the new price per share, for each company. Provide your opinion / assessment of your investments.

  What other factors can impact bond valuation

Is your bond selling for a premium or at a discount based on your calculation? What other factors can impact bond valuation?

  Computation of effective duration of a bond for change

Computation of effective duration of a bond for change in interest rates and Calculate the effective convexity to a 100 basis point change of the bond

  Would you recommend renewing the loan or demand repayment

Similarly, if you were the bank loan officer, would you recommend renewing the loan or demand its repayment?Would your actions be influenced if in early 2009 D'Leon showed you its 2009 projections along with proof that it was going to raise more than..

  How to do forecasting eps if sales drop

How to do Forecasting EPS if sales drop where Fixed operating costs are $2.5 million and the variable cost ratio is 65%

  What are annual depreciation charges

There would be no effect on revenues, but pretax labor cost will decline by $44,000 per year. The marginal tax rate is 35% and WACC is 12%.

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