Question
In: Finance
Which of the following bonds will have the smallest percentage increase in value if all market...
| Which of the following bonds will have the smallest percentage increase in value if all market interest rates decrease by 1%? | |||||||||||||||||
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Solutions
jeff jeffy answered 2 years agoRelated Solutions
1. Which of the following bonds would have the highest percentage change in value if all...
1.
Which of the following bonds would have the highest percentage
change in value if all interest rates in the economy decrease by
1%?
Group of answer choices
20-year, zero coupon bond.
20-year, 5% coupon bond.
10-year, zero coupon bond.
1-year, 10% coupon bond.
20-year, 10% coupon bond.
2.
Suppose you are signing a loan contract of $65,000 at an
interest rate of 8.5%. You must make 5 equal payments at the end of
the year for 5 years. How...
If its yield to maturity declined by 1%, which of the following bonds would have the largest percentage increase in value
If its yield to maturity declined by 1%, which of the following
bonds would have the largest percentage increase in valueA 1-year zero coupon bond.A 1-year bond with an 8% coupon.A 10-year bond with an 8% coupon.A 10-year bond with a 12% coupon.A 10-year zero coupon bond.
which of the following strategies may increase economic value added a. increase profit as a percentage...
which of the following strategies may increase economic value
added
a. increase profit as a percentage of capital employed
b. borrow additional funds and invest in asset that earn more
than the weight average cost capital.
c. Sell off assets that earn more than the weighted average cast
at capital.
d. Increase profit as a percentage of capital employed and
borrow additional funds and invest in asset that earn more than the
weight average cost capital.
3. Calculate the fair present value of the following bonds, all of which have a 10...
3. Calculate the fair present value of the following bonds, all
of which have a 10 percent coupon rate (paid semiannually), face
value of $1,000, and a required rate of return of 8 percent.
a. The bond has 10 years remaining to maturity. _________
b. The bond has 15 years remaining to maturity. _________
c. The bond has 20 years remaining to maturity. _________
d. What do your answers to parts (a) through (c) say about the
relation between time...
Calculate the fair present value of the following bonds, all of which have a 5 percent...
Calculate the fair present value of the following bonds, all of
which have a 5 percent coupon rate (paid semiannually), face value
of $1000, and a required rate of return of 8 percent.
a. The bond has 10 years remaining to maturity.
b. The bond has 15 years remaining to maturity.
c. The bond has 20 years remaining to maturity.
d. Wha do your answers say about the relationship between time
to maturity and present value?
Which of the following is the smallest volume? Which of the following is the smallest volume?...
Which of the following is the smallest volume? Which of the
following is the smallest volume? 9.0 × 106 nL, 2.6 cm3, 3.5 × 102
mL, 0.065 dL
A set of bonds all have the same maturity. Which one has the least percentage price...
A set of bonds all have the same maturity. Which one has the
least percentage price change for given shifts in interest rates:
(choose one correct answer)
not enough information to determine.
zero coupon bonds.
pure discount bonds.
low coupon bonds.
high coupon bonds.
Which of the following is true of bonds? a Since bonds have a face value of...
Which of the following is true of bonds?
a
Since bonds have a face value of $1,000, they can be purchased
at any time for $1,000.
b
Once purchased, bonds cannot be sold and must be held until
maturity.
c
Investors in bonds are part owners of the corporation that
issued the bonds.
d
For the corporation that issues bonds, bonds are a way to fund
its assets.
Calculate the value of each of the bonds shown in the following table, all of which...
Calculate the value of each of the bonds shown in the following
table, all of which pay interest semiannually.
Bond
Par Value
Coupon
interest rate
Years to
maturity
Required stated
annual return
A
$500
8%
9
11%
B
1,000
13
20
11
C
500
15
5
16
The value of bond A, B, C is $?? (Round to the nearest
cent.)
Calculate the value of each of the bonds shown in the following table, all of which...
Calculate the value of each of the bonds shown in the following
table, all of which pay interest semiannually
Bond
Par Value
Coupon
interest rate
Years to
maturity
Required stated
annual return
A
$1,000
8
%
10
11
%
B
500
14
15
10
C
500
14
6
12
The value of bond A is
$nothing. ?
(Round to the nearest cent.)
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