Business College

You bought a 1000 par value callable bond right after a coupon payment and paid 918 for it. You held it until it was called for 1100 (prior to maturity). The bond had a coupon rate of 9% payable semi-annually. The nominal yield rate convertible semi-annually was 10%. For how many years did you hold the bond

Answers

Answer 1

Answer:

25 years

Explanation:

We first set BA II Plus calculator : C/Y = 2, P/Y = 2

Then, I/Y = 10, PMT= -45(1000*9%/2), FV= -1100, PV=918

CPT No of years = N(I/Y, PMT, -FV, PV) (Semi annual period)

CPT No of years = 49.35 (Semi annual period)

CPT No of years = 49.35/2

CPT No of years = 24.68

CPT No of years = 25 years

Related Questions

Jacobs Company has warrants outstanding, which are selling at a $3.00 premium above intrinsic value. Each warrant allows its owner to purchase one share of common stock at $26. If the common stock currently sells for $30, what is the warrant price? (Round your answer to 2 decimal places.) $11.00 $7.00 $8.00 $10.00

Answers

Answer: $7.00

Explanation:

Based on the information provided in the question, the warrant price would be calculated as the addition of the premium which is above the intrinsic value and the paid in excess of the common stock. This will be:

= $3 + ($30 - $26)

= $3 + $4

= $7.00

Hull Company reported the following income statement information for the current year: Sales $ 413,000 Cost of goods sold: Beginning inventory $ 136,500 Cost of goods purchased 276,000 Cost of goods available for sale 412,500 Ending inventory 147,000 Cost of goods sold 265,500 Gross profit $ 147,500 The beginning inventory balance is correct. However, the ending inventory figure was overstated by $23,000. Given this information, the correct gross profit would be:

Answers

Answer: $124,500

Explanation:

If Ending Inventory was overstated by $23,000, this means that Cost of Goods was understated by $23,000.

Actual Cost of Goods sold = 265,500 + 23,000

= $288,500

Gross profit = Sales - Cost of goods

= 413,000 - 288,000

= $124,500

Kaelyn's mother, Judy, looks after Kaelyn's four-year-old twins so Kaelyn can go to work (she drops off and picks up the twins from Judy's home every day). Since Judy is a relative, Kaelyn made sure, for tax purposes, to pay her mother the going rate for child care ($6,460 for the year). What is the amount of Kaelyn's child and dependent care credit if her AGI for the year was $37,600

Answers

Answer:

Kaelyn's child and dependent care credit is:

$2,100.

Explanation:

a) Data and Calculations:

Going rate for child care for twins = $6,460

Maximum allowed = $6,000

Kaelyn's AGI for the year = $37,600

Percentage of child and dependent care credit = 35% of the allowed maximum for two children

b) The maximum qualified child and dependent care expense is $6,000 ($3,000 each) that Kaelyn can claim for the twins.  Therefore, her child and dependent care credit is 35% of $6,000, which equals $2,100.

A pizza monopolist employing third-degree price discrimination charges students $10 per pizza and everyone else $15 per pizza Students must show the ID before they can get the discount The marginal cost of this monopolist is $5 whether or not the customer is a student. The price elasticity of demand for the students is

Answers

Answer:

The price elasticity of demand for the students is:

inelastic.

Explanation:

The price elasticity of demand for the students is inelastic because there is no change in the quantity demanded by students that changes the price at which pizza is sold to the students.  If one student buys the pizza, the price charged remains $10 and if 1,000 students buy the pizza, the price remains $10 per unit.  Therefore, students' demand for the pizza is said to be static irrespective of price because the price is fixed.

"We know that how we present data often can affect the audience’s conclusions about the data. In a recent article from Travel Weekly on the Department of Transportation’s on-time stats for airline arrivals, the argument is made that the airline industry pads its own statistics in order reap cost benefits, which may or may not be passed on to consumers. Is the reporting difference an ethical breach of confidence between the consumer and the industry?"

Answers

Answer:

The reporting difference is not an ethical breach of confidence between the consumer and the industry.

Explanation:

The information being presented is not confidential information.  As a result, there is no ethical breach of confidence.  Usually, such a lawsuit for breach of confidence is an action originating in common law concerning information between the airline and the consumers, when one of these parties decides to use the available confidential information for an unfair gain or advantage.  This is not the case here between the airlines and the consumers of its services.  Therefore, the case for breach of confidence should deal with the restriction of the dissemination of commercially viable information.

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