What is your current yield on the bond

Assignment Help Financial Management
Reference no: EM131558874

You purchased a $3000 face/ par value bond for $2845.37 last year. The bond has a coupon rate of 6% and matures in three years. You received a yearly coupon payment last month. The bind currentry sells for $ 2791.74 in the market. (round 2 decimal places)

1.  What is your current yield on the bond?

2. if you sell the bond today for $2835.21, what is your capital gain/loss rate on the investment?

3. If you sell the bind for $2767, what is your total rate of return on this investment?

Reference no: EM131558874

Questions Cloud

Compute the accounting rate of return : Compute Southwest’s Weighted Average Cost of Capital. Compute the Accounting Rate of Return.
Recommendation to the management of jeans manufacturing : Evaluate the proposed tightening of credit standards, and make a recommendation to the management of Jeans Manufacturing.
Statements concerning pension portfolio investments : Which of the following statements concerning pension portfolio investments is (are) correct?
Calculate the annual cash flows from fixed-payment annuity : Calculate the annual cash flows (annuity payments) from a fixed-payment annuity if the present value of the 25-year annuity is $1.9 million.
What is your current yield on the bond : What is your current yield on the bond?
Statements concerning ira rollovers : Which of the following statements concerning IRA rollovers is (are) correct?
Standard mix of debt and equity at firm weighted average : it will be funded with Morningside’s standard mix of debt and equity at the firm’s weighted average (after-tax) cost of capital of 9%.
Control premium percentage and total transaction value : MSC’s stock drops to $25. At that point, what is the control premium percentage and total transaction value?
Best reflects the solvency of prospective client : Which of the following ratios best reflects the solvency of a prospective client who has applied for a loan?

Reviews

Write a Review

Financial Management Questions & Answers

  What is the yield to maturity of bond

What is the yield to maturity of a 23-year bond that pas a coupon rate of 8.25% per year, has a $1,000 par value, and is currently priced at $1,298.05? Assume semi-annual coupon payments. Round the answer to two decimal places in percentage form.

  What is the net advantage to leasing arrangement

To finance some manufacturing tools it needs for the next 3 years, Waldrop Corporation is considering a leasing arrangement. The tools will be obsolete and worthless after 3 years. The firm will depreciate the cost of the tools on a straight- line ba..

  The face value of mortgage note

If the face value of a mortgage note is $70million and the pv is $102 million. There are 5 years remaining on the bond. Does it make sense to sell it now for $47million or hold on to it for 5 years and sell it later?

  Used the straight-line depreciation method

Benson Company purchased equipment for $80,000 in 2012. The machinery originally had an estimated life of 10 years and a salvage value of $5,000. Benson used the straight-line depreciation method. In 2016, the estimated life was changed to 8 years. R..

  What is the primary goal of investor-owned corporations

What is the difference between a standard corporation (C corporation) and a benefit corporation (B corporation)? What is the primary goal of investor – owned corporations? What is the primary goal of most not – for – profit healthcare organizations?

  Distributed to expendable funds entire income earned

The Nebraska Institute of Science (NIS) pools all of its endowment funds so that it can obtain the benefits of a large and diverse investment portfolio. Suppose NIS charged depreciation and distributed to expendable funds the entire ‘‘income’’ earned..

  About the free cash flow

Free Cash Flow Tater and Pepper Corp. reported free cash flows for 2015 of $39.1 million and investment in operating capital of $22.1 million. Tater and Pepper incurred $13.6 million in depreciation expense and paid $28.9 million in taxes on EBIT in ..

  Assume that tuition does not increase over time

Your daughter will start college one year from today, at which time the first tuition payment of $58,000 must be made. Assume that tuition does not increase over time and that your daughter remains in school for four years. How much money do you need..

  What is the one year future exchange rate

John wants to build a new building. He needs $35 million. He may borrow in the US at 4.5% or in the UK for 7.5% for 1 year. The current exchange rate is $1.5:£1.0. What is the 1 year future exchange rate?

  Loan amortization and ear

LOAN AMORTIZATION AND EAR You want to buy a car, and a local bank will lend you $20,000. The loan will be fully amortized over 5 years (60 months), and the nominal interest rate will be 12% with interest paid monthly. What will be the monthly loan pa..

  About the real estate finance

You are currently considering buying a new flat and have received the following offer from your bank: What is the monthly payment that will fully amortize the loan over the 30 year period? Given an annual price appreciation of 3 percent, what loan ba..

  The percentage of sales forecasting method

The percentage of sales forecasting method is used by management to forecast the amount of

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