Yield to maturity and par value and market value of bond

Assignment Help Financial Management

Reference no: EM131882234

Yield to maturity-The Salem Company bond currently sells for 804.01?, has a coupon interest rate of 9?% and a $1000 par? value, pays interest annually?,and has 18 years to maturity.

a. Calculate the yield to maturity ?(YTM?) on this bond.

b. Explain the relationship that exists between the coupon interest rate and yield to maturity and the par value and market value of a bond.

Reference no: EM131882234

Questions Cloud

Evaluates assets using mean-variance function : Assume an investor evaluates assets using a mean-variance function, Compute the optimal portfolio choice.

Discuss about a company with which you are very familiar : Think of an organization you have worked for or one with which you are very familiar. Diagnose the need for change and present a plan to transform .

What sort of work atmosphere would you be best in : Does it fit you or do you disagree? What sort of work atmosphere would you be best in, given the results of the Myers-Briggs Type indicator?

Decentralization of pricing decisions : Always Round Tire has service stores in Memphis and Knoxville (which are hundreds of miles apart). The company is considering the decentralization of pricing

Yield to maturity and par value and market value of bond : Explain the relationship that exists between the coupon interest rate and yield to maturity and the par value and market value of a bond.

Practice that competitive companies use : One practice that competitive companies use is "Price Discrimination" what it means is one group of our customers pays a different price than another customer

George scotch consumption : Does this imply that cigars and scotch are complements to George? Explain your answer.

Determine the risk level of the stock from investors point : Provide a rationale for the stock that you selected, indicating the significant economic, financial, and other factors that led you to consider this stock.

What is the required return on the stock : A stock sells today for $38, and just paid a dividend of $2. If the growth rate is 4%, what is the required return on the stock?

User Account

All Pages