Business, 03.03.2020 03:50 amirasaleh1012
Assume Oliver wants to earn a return of 10.50% and is offered the opportunity to purchase a $1,000 par value bond that pays a 8.75% coupon rate (distributed semiannually) with three years remaining to maturity. The following formula can be used to compute the bond’s intrinsic value:
Intrinsic ValueIntrinsic Value = A/(1+C)^1+A/(1+C)^2+A/(1+C)^3+A/(1+ C)^4+A/(1+C)^5+A/(1+C)^6+B/(1+C)^6< br />
Based on this equation and the data, it is (unreasonable/reasonable) to expect that Oliver’s potential bond investment is currently exhibiting an intrinsic value less than $1,000.
Now, consider the situation in which Oliver wants to earn a return of 11.75%, but the bond being considered for purchase offers a coupon rate of 8.75%. Again, assume that the bond pays semiannual interest payments and has three years to maturity. If you round the bond’s intrinsic value to the nearest whole dollar, then its intrinsic value of (rounded to the nearest whole dollar) is (equal to/greater than/less than) its par value, so that the bond is (trading at premium/par/discount).
Answers: 2
Business, 22.06.2019 19:00
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Business, 22.06.2019 20:30
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Business, 22.06.2019 21:30
Zara, a global retail and apparel manufacturer based in spain that has successfully implemented this idea by having a continuous flow of new products that are typically limited in supply. zara has created a system that draws its clientèle into its stores, on average, 17 times per year as compared to 4 times per year for most stores. how is zara using it to gain competitive advantage? what specific technologies are used by zara to maintain this advantage over its competition?
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Providing a great shopping experience to customers is one of the important objectives of purple fashions inc., a clothing store. to achieve this objective, the company has a team of committed customer service professionals whose job is to ensure that customers get exactly what they want. this scenario illustrates that purple fashions is trying to achieve
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Assume Oliver wants to earn a return of 10.50% and is offered the opportunity to purchase a $1,000 p...
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