What is the price of the bond

Assignment Help Finance Basics
Reference no: EM132502482

A pure discount (or zero-coupon) government bond is issued today that promises to pay $15,000 in 15 years. If the current interest rate on similar bonds is 7%, what is the price of the bond? Recall that the compounding interval for bonds is 6 months.

Reference no: EM132502482

Questions Cloud

Explain the benefits of resistance training : The American College of Sports Medicine and the American Heart Association recommend adults get 150 minutes of moderate-intensity exercise each week.
Show an amortization table representing : Show an amortization table representing the following situation. You are buying a house. The sale price is $150,000, and you have a downpayment
Expected return on the stock : What would be the expected return on the stock if the expected market return increased to 14.00% while the risk-free rate and beta remained unchanged?
What is the yield to maturity of a zero coupon bond : What is the yield to maturity (YTM) of a zero coupon bond with a face value of $1,000, current price of $800 and maturity of 7 years?
What is the price of the bond : If the current interest rate on similar bonds is 7%, what is the price of the bond? Recall that the compounding interval for bonds is 6 months.
How much will the jacksons first monthly payment be : They are considering a fixed rate 15-year mortgage at a 6.25% APR with monthly payments. How much will the Jacksons' first monthly payment be?
Determining the fair price for the property : What is a fair price for the property assuming that the building's remaining life is 25 years?
Explain the production and cost in the short run : Topics: Production and Cost in the Short Run; Managerial Decisions in Competitive Markets. In no less than two and no more than four pages, summarize the.
Compute the equivalent units and costs per equivalent unit : Compute the equivalent units and costs per equivalent unit for March in the assembly department. Compute the cost of the ending Work-in-Process.

Reviews

Write a Review

Finance Basics Questions & Answers

  What is the required return for abc

What is the required return for ABC? Given the required return, what is the value of the stock?

  What is the interest rate on one year loan

The 3-year, 4-year, and 5-year zero-rate on a yield curve is 6%, 7% and 8% repectively. What is the interest rate on a 1-year $10,000 loan that you plan.

  Explain how the spot and forward rates of the pound

Assume the following information: • British pound spot rate = $1.71 • British pound one-year forward rate = $1.69 • British one-year interest rate = 8% • U.S. one-year interest rate = 5% a. Explain how U.S. investors could use covered interest arbitr..

  Analyzing the impact of selected transactions on the

analyzing the impact of selected transactions on the current ratio - current assets for london corporation totaled

  What is the net present value of the machine

The machine will be sold for $120,000 after taxes at the end of year five. What is the net present value of the machine if the required rate of return is 13.5%.

  Suppose you find that prices of stocks before large

suppose you find that prices of stocks before large dividend increases show on average consistently positive abnormal

  What is the historical average return over the last four yea

The returns on XYZ Corp. over the last four years are 10%, 12%, 3%, and -9%. a. What is the historical average return over the last four years? b. What is the variance of the returns over the last four years? c. What is the standard deviation of the ..

  What do you think of the pest analysis

What do you think of the PEST analysis? Is it a useful tool for assessing a company's external environment?

  What should be used for the risk free rate

We are considering an investment with an expected life of five years. Further, the investment is going to be made in Mexico.

  How can a companys cost of equity be determined

fin301- What are the advantages and disadvantages for AMSCto forgo their debt financing and take on equity financing? Do you agree with their decision? How can a company's cost of equity be determined?

  1 compute the present value of a two-period annuity of 1

1. compute the present value of a two-period annuity of 1 per period if the discount rate is 10 percent.2. a two-period

  How many polo shirts can zane purchase today

a. How many polo shirts can Zane purchase today? b. How much money will Zane have at the end of 1year if he forgoes purchasing the polo shirts today? c. How much would you expect the polo shirts to cost at the end of 1 year in light of the expected i..

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