What is the modified duration of this bond

Assignment Help Financial Management

Reference no: EM132028564

A $1,000 par value bond pays an annual coupon of 10.0%and matures in 4 years. If the bond sells to yield 7%, what is the modified duration of this bond?

a) The regular duration is:

b) The modified duration is:

Reference no: EM132028564

Questions Cloud

Optimal fraction of debt and the growth rate of firm : Define the optimal fraction of debt and the growth rate of a firm. What is the relationship between the two?

Unassigned costs and desired profit : Compu Services provides computerized inventory consulting. what is the markup on variable costs to cover (1) unassigned costs and (2) desired profit?

Brand of computers for newer model : Apple Inc. is considering discontinuing its Model A brand of computers for a newer model which will sell for the next three years.

What is cost of equity after recapitalization : Assume the firm borrows $157,000 and uses the proceeds to repurchase shares. What is the cost of equity after recapitalization?

What is the modified duration of this bond : A $1,000 par value bond pays an annual coupon of 10.0%and matures in 4 years. If the bond sells to yield 7%, what is the modified duration of this bond?

The standard deviation of expected returns for time period : The probability distribution of cash flows is approximately normal. The standard deviation of expected returns for this time period is $20,000.

What is the company cost of equity capital : What is the company's cost of equity capital? What would the weighted average cost of capital be if the company's debt equity ratio were .65 and 1.55?

Use the ev and ebitda approach to value the firm : Creative Centers Inc. has an EBIT of $200,000, $30,000 in depreciation, $450,000 in outstanding debt, Use the EV/EBITDA approach to value the firm.

You have to pay over the entire life of the loan : How much total interest would you have to pay over the entire life of the loan.

User Account

All Pages