subject
Business, 21.02.2020 06:05 jesse1384

A 30-year maturity bond has a 6.3% coupon rate, paid annually. It sells today for $868.67. A 20-year maturity bond has 5.8% coupon rate, also paid annually. It sells today for $884.5. A bond market analyst forecasts that in 5 years, 25-year maturity bonds will sell at yields to maturity of 7.3% and 15-year maturity bonds will sell at yields of 6.8%. Because the yield curve is upward sloping, the analyst believes that coupons will be invested in short-term securities at a rate of 5.0%. What rate of return does each bond offer over the 5-year period?(Round your answers to 2 decimal places. Omit the "%" sign in your response.)

Rate of Return
30 year bond %
20 year bond %

ansver
Answers: 1

Another question on Business

question
Business, 21.06.2019 19:00
If a company’s employees are angry about their work, a visiting auditor may also become agitated, illustrating the power of
Answers: 1
question
Business, 21.06.2019 23:30
Which type of market are you in if your company, along with three other companies, controls 95 percent of the total music industry?
Answers: 3
question
Business, 22.06.2019 02:20
The following information is available for jase company: market price per share of common stock $25.00 earnings per share on common stock $1.25 which of the following statements is correct? a. the price-earnings ratio is 20 and a share of common stock was selling for 20 times the amount of earnings per share at the end of the year. b. the market price per share and the earnings per share are not statistically related to each other. c. the price-earnings ratio is 5% and a share of common stock was selling for 5% more than the amount of earnings per share at the end of the year. d. the price-earnings ratio is 10 and a share of common stock was selling for 125 times the amount of earnings per share at the end of the year.
Answers: 1
question
Business, 22.06.2019 05:00
Which of the following differentiates cost accounting and financial accounting? a. the primary users of cost accounting are the investors, whereas the primary users of financial accounting are the managers. b. cost accounting measures only the financial information related to the costs of acquiring fixed assets in an organization, whereas financial accounting measures financial and nonfinancial information of a company's business transactions. c. cost accounting measures information related to the costs of acquiring or using resources in an organization, whereas financial accounting measures a financial position of a company to investors, banks, and external parties. d. cost accounting deals with product design, production, and marketing strategies, whereas financial accounting deals mainly with pricing of the products.
Answers: 3
You know the right answer?
A 30-year maturity bond has a 6.3% coupon rate, paid annually. It sells today for $868.67. A 20-year...
Questions
question
Spanish, 29.08.2020 01:01
question
Mathematics, 29.08.2020 01:01
Questions on the website: 13722366