You pay $5600 for a municipal bond. When it matures after 15 years, you receive $11,000 The total return is ___%.
Q: A municipal bond with a face value of $10,000 and bond interest rate of 8% per year payable…
A: Face Value $ 10,000.00 Coupon rate 8% Time Period 30 Yield 12% Time Passed 10
Q: ABC Trucking has issued an 14-percent, 10-year bond that pays interest semiannually. If the…
A: Bond Valuation: It determines the intrinsic or fair value of particular debt security.
Q: An investor purchases a 20-year, $1,000 par value bond that pays semiannual interest of $40. If the…
A: The Stated semiannual interest payment $40 Rate of interest = 5% 20 years * 2 = 40 payments Present…
Q: [For this question, please write down your answer on a piece of paper and attach it.] The government…
A: The price of a bond refers to the is the present discounted value of a future stream of cash flows.…
Q: Suppose you invest in a municipal bond that pays a yield of 149%. If your marginal tax is 15%, what…
A: A municipal bond is a government debt security issued to raise long-term debt funds. The yield…
Q: A man bought a 5% tax-free municipal bond. It cost $1000 and will pay $50 interest each year for 20…
A: The real rate is the interest rate which removes the effect of inflation to compute the real cost of…
Q: ABC Corporation issued today a bond in favor of Mr. Barboncito and the bond has a face value of…
A: given information face value = P 1,000,000 bond rate = 7% interest rate = 12% no of years = 6 years…
Q: Bramble Corporation, having recently issued a $20,094,900, 15-year bond issue, is committed to make…
A: The question is based on the concept Annuity
Q: Hassan Mustafa realized that when the bonds mature on January 20, 2041, there must be $5,200,000…
A: Sinking fund is type of account in which periodic payment is paid in each period and interest is…
Q: Mountain Equipment Co-op has just issued $700,000 in 10-year bonds. They are required to establish a…
A: Future Value = $700,000 Time Period = 10 Years Interest rate = 4% Frequency =2
Q: The Saleemi Corporation's $1,000 bonds pay 6 percent interest annually and have 14 years until…
A: Annual coupon interest payments = 6% of 1000 = 60 14 such coupons will be paid.
Q: what is the equIvalent yield on the taxable bond?
A: Tax Equivalent Yield: It is the return needed for a taxable bond to equal the yield of the…
Q: A Montana state bond can be converted to $1,000 within 5 years of purchase. If the Montana bonds are…
A: Zero Coupon Bonds don't pay any coupons. They are also called Deep Discount Bonds because they are…
Q: A $10,000 commercial bond that has a 6% bond rate and matures in 5 years can be purchased for…
A: A financial instrument with a fixed cost that helps a company to raise funds for business operations…
Q: Strikler inc. Has issued 10 million 10 year bond. The bond requires strikler to establish a sinking…
A: Sinking fund : A sinking fund is a fund containing money set aside or saved to pay off a debt or…
Q: Fareed purchases a bond, newly issued by the Big Time Corporation, for $20,000. The bond pays $1,000…
A: Principal amount: Principal amount is the original amount of money borrowed by a person. In bonds,…
Q: John buy 15 tax free municipal bonds at a premium of $105.42. The coupon rate is 5.250% and the…
A: Given, Premium paid for bond is $105.42 Face value of bond is $1000
Q: Union Local School District has a bond outstanding with a coupon rate of 2.9 percent paid…
A: Calculation of Price of the Bond:The price of the bond is $9,184.18.Excel Spreadsheet:
Q: ACT has an outstanding bond with a face value (principal) of ₱1,000.00 which would mature in 10…
A: The market value of a bond is the price at which you could sell it to another investor before it…
Q: Freddy’s Farm issued a 25-year, 5 percent semiannual bond three years ago. The bond currently sells…
A: Given:
Q: You can invest in taxable bonds that are paying a yield of 9.7 percent or a municipal bond paying a…
A: A financial instrument that does not affect the ownership of the common shareholders or management…
Q: You purchased a $1000 10-year bond that pays $95 annually. If current interest rates are 11.25%,…
A: Yield to maturity Years 10 coupon amount (PMT) 95 Face value (FV) 1000 Yield rate 11.25%…
Q: Suppose a State of New York bond will pay $1,000 ten years from now. If the going interest rate on…
A: The concept of the time value of money states that the current worth of money is more than its value…
Q: A one-year U.S. Treasury bond and a one-year corporation bond both promise to pay $11,934 next year.…
A: A bond is a debt instrument that is used for raising capital by organizations for their operations.…
Q: earson Co issue its $140,000 at a price of 94, the stated rate is 6%, the bond term is 4 years, and…
A: Solution: Annual interest payment = Face value of bond * stated rate of interest = 140000 *6% =…
Q: Four and a half years ago, the city of Baltimore sold at par a $1,000 bond with a coupon rate of 9…
A: Using excel PV
Q: Union Local School District has a bond outstanding with a coupon rate of 3.4 percent paid…
A: The computation of the price of the bond as follows:
Q: The ELdian Republic issued 100,000 T-bill that can be bought for 98. This T-bill will mature 90…
A: Par value of T-Bill = 100,000 Issue price = 100,000*98/100 = 98,000 Period = 90 Days
Q: Suppose your marginal federal income tax rate is 25 percent. 1. What is your after-tax return from…
A: The question is to study the impact on tax rate on yield of different types of bonds, in general…
Q: Five years ago, the State of Rhode Island issued $2,000,000 of 7% coupon, 20-year semiannual…
A: 1. The computation of NPV of Refunding as follows: The formula used for the computation of NPV of…
Q: A home appliance manufacturing company plans to invest what it considers "temporary excess fund" in…
A: Bonds: Bonds are the liabilities of the company which is issued to raise the funds required to…
Q: Assume that Beach Inc. has an issue of 20-year $1,000 par value bonds that pay 7% interest,…
A: The value of the bond is the current price of the bond. It is the present value of the cash flows…
Q: Johnson Corporation plans to obtain financing with a $1,000,000 bond issue that has a term of 10…
A: Given, Face Value = $1,000,000 years = 10 Coupon Rate =7% Semi annual bond
Q: A bond matures in 20 years, at which time it pays the owner $1,000. It also pays $70 at the end of…
A: Year of Bond =20 Annual payment =$70 Face Value =$1000
Q: Prepare a schedule for the following bond, including calculations, yearly income, end-of-year…
A: Given:
Q: A 15-year municipal bond was issued 5 years ago. Its coupon interest rate is 4%, interest payments…
A: Bond value is the current worth of the bond on the basis of the present value of all the cash flows…
Q: One hundred $1,000 bonds having a bond rate of 8% per year payabie quarterly are purchased for…
A: The following formula will be used:
Q: Suppose you invest in a municipal bond that pays a yield of 4. If your marginal tax is 17%, what is…
A: Here, Municipal Bond Yield is 4% Marginal tax Rate is 17%
Q: An investor is comparing the following two bonds: a bond from ABC Corp which pays an interest rate…
A: Taxation-Taxation means imposing a tax on individuals and different types of organizations. Which…
Q: Assume a corporation issue a $2 million bond to finance its new project. The bond pays an 8%…
A: Bond issue = $2million or $2,000,000 Coupon rate = 8% Semiannual coupon payment = $2,000,000 ×…
Q: Lepus has issued bonds of $100 nominal value with annual interest of 9% per year, based on the…
A: Bonds are the instruments of debt that are issued by a company or the government for the purpose of…
Q: We are planning to purchase a 6% bond with a face value of $1000 that pays interest semi-annually.…
A: A financial instrument that does not affect the ownership of the common shareholders or management…
Q: A 7-year municipal bond with a face value of $1,000 earns annual income of $480. Your marginal tax…
A: Given: Annual income = $480 Tax rate = 36%
Q: Suppose a State of New Jersey bond will pay $1,000 five years from now. If the going interest rate…
A: Face value = $1000 Time =5 years Interest rate = 4.1% Present value of the bond = Using excel PV…
- You pay $5600 for a municipal bond. When it matures after 15 years, you receive $11,000
The total return is ___%.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- A company issued bonds with a $100,000 face value, a 5-year term, a stated rate of 6%, and a market rate of 7%. Interest is paid annually. What is the amount of interest the bondholders will receive at the end of the year?On July 1, a company sells 8-year $250,000 bonds with a stated interest rate of 6%. If interest payments are paid annually, each interest payment will be ________. A. $120,000 B. $60,000 C. $7,500 D. $15,000If Bergen Air Systems takes out a $100,000 loan, with eight equal principal payments due over the next eight years, how much will be accounted for as a current portion of a noncurrent note payable each year?
- You pay $8000 for a municipal bond. When it matures after 20 years, you receive $12,500. a. Find the total return. Total Return: _____________ b. Find the annual return. Annual Return: _____________The City of State College plans to issue bonds with a par value of $12,000 that will issue 6% quarterly payments for 3 years. If a purchaser wants earn 7% per quarter over the lifetime of the bond, how much would the purchaser be willing to pay for the bond?$52,000 is invested in a 5-year fixed interest bond paying 5.5% per year. If interest is reinvested in the account, how much will the bond be worth in 5 years? Round your answer to the nearest dollar.
- A bond pays $1,500 at the end of each year for five years, plus an additional $2,000 when the bond matures at the end of five years. What is the most you would be willing to pay for this bond if your opportunity cost of funds is 5 percent?Prepare a schedule for the following bond, including calculations, yearly income, end-of-year accumulations, and net of tax: You purchase a one-year municipal bond for $150,000. Every year on December 30, the muni bond will mature and pay interest, and on that date, you will put the income, net of any taxes due, in a bank CD and utilize the principle to purchase another one-year muni-bond. The CD also has a maturity of one year, and you'll reinvest the principle and any CD income, net of any tax he owes, together with the muni revenue, in another CD, and so on. When the last muni and CD mature at the end of year three, you will keep the CD and muni amounts as of that time, net of any taxes due, to support your children's education. （you invest on Jan 1 on the first year, and cash out on December 31 on the last year). You are, and will stay, in the 40% ordinary income and 20% long-term capital gains tax rates. The muni-bond has a rate of return of 4%, whereas a CD has a rate of return…You purchase a $10,000 bond with a bond rate of 6% per year payable semiannually for 2 years. You pay $9,600 for the bond. Which statement is correct?
- You have just purchased a municipal bond with a $10,000 par value for $9,500. You purchased it immediately after the previous owner received a semiannual interest payment. The bond rate is 6.6% per year payable semiannually. You plan to hold the bond for 6 years, selling the bond immediately after you receive the interest payment. If your desired nominal yield is 10% per year compounded semiannually, what will be your minimum selling price for the bond?Without using excel, answer the question: The City of State College plans to issue bonds with a par value of $12,000 that will issue 6% quarterly payments for 3 years. If a purchaser wants earn 7% per quarter over the lifetime of the bond, how much would the purchaser be willing to pay for the bond?A certain government-issued 10-year bond pays an interest at 16 percent every three months. If the total quarterly expense is 83,000 and the bond earns at 20 percent every three months, what is the face value of the bond? How much in the present should he pay for the bond? Round off to two decimal places in the final answer/s.
