Business, 04.04.2020 12:04 angellll4455
Use the following corporate bond quote information to answer the questions that follow. Since this is a corporate bond,
assume the company makes semi-annual coupon payments and also assume the bond matures on today’s date in its
maturity year.
Bond Cur. Yld. Vol. Close Net Chg.
Doh! 9 ½ 18 9.0 5 105 1/2 - 1/4
Doh! 8 ½ 21 9.4 10 90 1/4 -1/2
1. How much would each bond cost you to buy today if its face value is $1000?
2. How much would each bond cost you yesterday if its face value were $1000?
3. What is each bond’s yield to maturity?
4. What is each bond’s expected capital gains yield today?
5. Now imagine you purchased each bond today at the current price. A year later the yield to maturity for each
bond falls by one percentage point. What is your total rate of return for each bond?
6. Now imagine the same scenario in #5 (the last question) except the yield to maturity for each bond increases
one percentage point for each bond a year later. What is your total rate of return for each bond?
7. Which bond do you prefer in #5, and what type of risk are you more exposed to if you choose this particular
bond?
8. Which bond do you prefer in #6, and what type of risk are you more exposed to if you choose this particular
bond?
Answers: 2
Business, 22.06.2019 07:50
The questions of economics address which of the following ? check all that apply
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Business, 22.06.2019 16:00
In a perfectly competitive market, the long-run market supply curve tends to be horizontal or nearly so. what is another way to state this fact? (a) market supply is much more elastic in the long run than the short run. (b) in the long run, average total cost is minimized. (c) in the long run, price equals marginal cost. (d) market supply is much less elastic in the long run than the short run.
Answers: 1
Business, 22.06.2019 17:50
The management of a supermarket wants to adopt a new promotional policy of giving a free gift to every customer who spends > a certain amount per visit at this supermarket. the expectation of the management is that after this promotional policy is advertised, the expenditures for all customers at this supermarket will be normally distributed with a mean of $95 and a standard deviation of $20. if the management wants to give free gifts to at most 10% of the customers, what should the amount be above which a customer would receive a free gift?
Answers: 1
Business, 22.06.2019 22:40
Crowding out is a phenomenon focused upon most by the macroeconomists of whereby a government deficit interest rates, which in turn private investment spending. this group also believed that fiscal policy is the only thing that can lower natural unemployment. is just as effective in countering recessions as monetary policy. can be used most of the time, but monetary policy becomes a better option when velocity is fluctuating. should be used only if the central bank follows a monetary policy rule. faces problematic lags in propagating changes throughout the economy.
Answers: 3
Use the following corporate bond quote information to answer the questions that follow. Since this i...
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