BUG's stock price S is $108.67 today. It pays dividend of $0.5 after two months an- $0.6 after five and a half months. If the continuously compounded interest rate is 1 percent per year, then the forward price of a 8-month forward contract on BUG is: [round to two decimal places]
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![BUG's stock price S is $108.67 today. It pays dividend of $0.5 after two months and
$0.6 after five and a half months. If the continuously compounded interest rate is 1.1
percent per year, then the forward price of a 8-month forward contract on BUG is:
[round to two decimal places]](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F27484300-95da-42ce-b23a-39f1abbb6553%2F8be504af-e36e-40d1-972e-e1bb2a31eb97%2Fijkuw3r_processed.jpeg&w=3840&q=75)
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- A one-year long forward contract on a non-dividend-paying stock is entered into when the stock price is $40 and the risk-free rate of interest is 10% per annum with continuous compounding. (a) What are the forward price and the initial value of the forward contract? (b) Six months later, the price of the stock is $45 and the risk-free interest rate is still 10%. What are the forward price and the value of the forward contract?On March 2021, a 6-month long forward contract on a dividend-paying stock is agreed between two parties when the stock price is $30. And the risk-free rate of interest is 5% per annum with continuous compounding. The stock pays dividends of $5 on January each year .5 What is the corresponding forward price?A 9-yearbond pays interest of $28.10 semiannually, has a face value of $1,000, and is selling for $848.90. What are its annual coupon rate and yield to maturity? The annual coupon rate is__________%.
- Suppose that $1,000 is deposited each year for five years into an equity (common stock) account earning 8% per year. During this period, general inflation is expected to remain at 3% per year. At the end of five years, what is the dollar value of the account in terms of today’s purchasing power (i.e., real dollars)?James has a 1 year ARM for 140,000 over a 25 year term , The margin is 2% and the index rate starts out at 2.5% and increases to 5.0% at the first adjustment, The balance of principal at the first year is 137,863.61, The ARM includes a periodic rate cap of 2% per adjustment period what is the monthly payment at the end of the first year?An investor pays $30,000 for a convertible bond (one that can be converted into shares of corporate common stock). The bond conversion rate is 100 shares of stock anytime within the next five years. What will the stock price have to be in year 3 in order for the investor to make 10% per year on the investment? Assume the bond interest rate is 4% per year payable annually.
- Five 15-year bonds each having a face value of $1,000 and a coupon rate of 6% per 6 months payable semiannually were purchased for $7,000 8 years ago, and the 16th coupon payment was just made. What can they be sold for now to a buyer if that buyer’s desired return is 4% per 6 months?You bought a $1000 corporate bond for $900 three years ago. It is paying $30 in interest at the end of every 6 months, and it matures in 5 more years. (a) Compute its coupon rate. (b) Compute its current value, assuming the market interest rate for such investments is 4% per year, compounded semiannually.You purchase a TIP note with an original principal amount of $1,000.000 and a 10 percent annual coupon (paid semiannually) What will the first coupon payment be if the semiannual inflation over the first six months is 3 percent? (round your answer to 2 decimal places)
- An investment promises to pay into an account that pays you 6 percent annually, $150 permonth for the next twenty-two years. Suppose the first deposit into the account is made one month from today what is the value of the amount which will be in the account at the end of thirty years? Rounded to 2 decimal places.An advertisement of an investment firm states that if you invest P500 in their firm today you will get P1,000 at the end of 4,5 years. What nominal rate is implied if interest is compounded quarterly? Determine also the effective rate of interest.Last year Carson Industries issued a 10-year, 15% semiannual coupon bond at its par value of $1,000. Currently, the bond can be called in 6 years at a price of $1,075 and it sells for $1,280. What is the current yield? What is the expected capital gains (or loss) yield for the coming year? Use amounts calculated in above requirements for calcuation, if reqired. Round your answer to two decimal places. Enter a loss percentage, if any, with a minus sign.