Investment fium recomenda Ang yould. on AmA Band = 6²/0 on A Bond = 7% B bond = 10% Client wants to inwest twice as much in AAA bands a B binds. How much should be invested in each in the total investment is $25,000. & insister annud return of $1,810 on the 3 investments?
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- ANG GANDA Co. is issuing 5 year, 5% P1,000,000 bonds. If aninvestor desires a 10% yield on his investments, at how muchshould he buy the bonds?mdc bulids and maintainsfreeway accross malaysia. theh have an outstanding issue of rm100 par value bondswiht a coupon an 5 percent copuon rate. the issue pays interest annually and has 12 yrs remaingto it maturirty 1) If bonds of similar risk are currenty earnig a 4% ratre of return, how much should mdc bond seel for today 2) describe the two posibble reason why the rate on similar risk bonf is below the coupon rate in MDC bond 3) if the required return were 10% instead of 4 % what would the current value of MDC bond be .contract this finding in part 1) and discusss7A-18. Schiffauer Electronics plans to issue 10-year, zero coupon bonds witha par value of $1,000 and a yield to maturity of 9.5 percent. Thecompany has a tax rate of 30 percent. How much extra in taxes wouldthe company pay (or save) the second year (at t = 2) if they go aheadand issue the bonds?a. Save $12.59b. Save $13.79c. Save $41.97d. No savingse. Pay $13.79
- Assume you make the following investments: A $10,000 investment in a 10-year T-bond that yields 6.00%, and a $20,000 investment in a 10-year corporate bond with an BBB rating and a yield of 8.30%. Based on this information, and the knowledge that the difference in liquidity risk premiums between the two bonds is 0.50%, what is your estimate of the corporate bond's default risk premium? A.) 2.30%? B.) 3.06%? C.) 1.80%? D.) 2.52%?Mr. Gonzalez wishes to sell a bond that has aface value of $1,000. The bond bears an interest rateof 8% with bond interest payable semiannually. Fouryears ago, $920 was paid for the bond. At least a9% return (yield) on the investment is desired. Whatmust be the minimum selling price?1) Your firm wishes to issue a 20-year bond, an annual coupon of 6%, and the price has been determined to be RM880. The floatation cost of the issuance is 2% of the selling price. The tax rate is 24%. a) The net selling price is RM________. b) Annual YTM is ________% c) After tax cost of debt is ______% Answer by using formula not a Excel don't use chatgpt
- Assume you make the following investments: • A $10,000 investment in a 10-year T-bond that yields 7.50%, and • A $20,000 investment in a 10-year corporate bond with an AA rating and a yield of 8.70% Based on this information, and the knowledge that the difference in liquidity risk premiums between the two bonds is 0.60%, what is your estimate of the corporate bond’s default risk premium? 0.84% 1.20% 1.02% 0.60%An investor has $7500 to invest in either a bond that matures in 6 years or a business that will produce a continuous stream of income over the next 6 years with rate of flow f(t)=1250. If both the bond and the continuous stream earn 5%, compounded continuously, which is the better investment?For each of the bonds and reinvestment rates listed below calculate the amount of money accumulated at the end from a $1000 initial investment . Assume annual compunding .with a yield to immaturity Invest $1000 in a 5years zero coupon bond of 9percent
- . A 7,000, 5% bond with annual coupons, redeemable at 108 at the end of 5 years is pricedto yield 4%, m=1. Construct a table showing the amortization of premium. (Amortization ofPremium)Suppose your firm issues a €100,000,000 5-year bond with a coupon rate of 8% per annum (assume annual compounding). The bond will sell at face value to investors. The underwriting spread is an up-front fee of 2%. What is the actual cost of this debt? Please enter your answer as % -- e.g. if your answer is 2.34% type in 2.34.A4) Finance Assume that a 6 percent sated interst, $500,000 bond with semianual interst payments and a remaining life of 10 years could be purchased today, when market interst rates are 4.5 percent. If the marlet interest rates rise to 4.0 percent, the bond price to buy will ____