7) Suppose that a bond is purchased between coupon periods. The days between the settlement date and the next coupon period are 90. There are 182 days in the coupon period. Suppose that the bond purchased has a coupon rate of 6.8% and there are 8 semiannual coupon payments remaining. The par value of the bond is $100.
a. What is the full price for this bond if a 6.4% annual
discount rate is used? b. What is the accrued interest for this
bond?
c. What is the clean price of the bond?
In: Finance
able 19-17
2013 | 2018 | |||
Product | Quantity | Price | Quantity | Price |
Movies | 20 | $6.00 | 30 | $7.00 |
Burgers | 100 | 2.00 | 90 | 2.50 |
Bikes | 3 | 1,000.00 | 6 | 1,100.00 |
A very simple economy produces three goods: movies, burgers, and bikes. The quantities produced and their corresponding prices for 2013 and 2018 are shown in the table above.
Refer to Table 19-17. What is real GDP in 2018, using 2013 as the base year?
In: Economics
A monopolist faces the following demand curve, marginal revenue curve, total cost curve and marginal cost curve for its product:
Q = 200 - 2P MR = 100 - Q TC = 5Q MC = 5
a) suppose that a tax of $5 for each unit produced is imposed by state government. What is the profit maximizing level of output?
b) suppose that a tax of $5 for each unit produced is imposed by state government. What is the price maximizing price?
In: Economics
Supplemental Problem 15-2
Beekley Company issued 300 shares of $10 par common stock and 100 shares of $50 par preferred stock for a lump sum of $13,500. The common stock has a market price of $20 per share and the preferred stock has a market value of $90 per share.
Prepare the journal entry to record the issuance.
Prepare the journal entry to record the issuance assuming the preferred stock has no market price.
In: Accounting
Suppose that the market demand for expensive steak dinners is given by:
Q = 1,000−10P,
so that the marginal revenue is:
MR = 100−0.2Q,
where Q is the number of steak dinners per day and P is the price of a dinner. The marginal cost and average total cost are both constant and equal to $40 per dinner.
Suppose that there is only one firm in the market.
The quantity that the firm produces will be how many dinners?
The price set by the firm will be?
The firm's economic profit is?
In: Economics
Assume you purchase 200 shares of Apple at $350 per share, but you are worried that it may fall in price, so you wish to hedge part of your position by writing a 100 share option. The option has a strike price of $300 and a premium of $50. If at that the time of expiration, the stock is selling at the following prices ($200, $300, $400) what will be your overall gain or loss? What about the person who bought the option from you?
In: Accounting
Round Answers to 2 decimal places.
Suppose that there is natural monopoly that faces a demand curve Q=100-P with total cost function C(Q)=400+15Q.
The profit maximizing quantity for the natural monopolist, in the absence of any regulation is ______ units.
The profit maximizing price that will set by the monopolist is $______
The average total cost per unit at the profit maximizing level of output is $______
The profit for the natural monopolist, given they set the profit maximizing price and level of output, is $________
In: Economics
Suppose a trader purchases a bond between coupon periods. The days between the settlement date and the next coupon period is 45. There are 90 days in the coupon period. Suppose that the bond purchased has a coupon rate of 8.0% and there are four quarterly coupon payments remaining. Face value is $100.
a) What is the dirty price of this bond if a 5.6% discount rate is used (assume that 5.6% is compounded quarterly)?
b) What is the accrued interest for this bond?
c) What is the clean price?
In: Finance
2. You have the following incomplete information on yields, forward rates from time t-1 to t, and prices (risk-free, zero-coupon bonds with face amount $100):
|
Maturity |
Yield |
Price |
Forward Rate |
|
1 |
P1=98.00 |
||
|
2 |
f2=2.50% |
||
|
3 |
y3=2.50% |
Given this information, what is the price of a 3-year, 5%, annual-pay, coupon bond with face amount $1,000? (Please fill in the table as well.)
In: Finance
Suppose a trader purchases a bond between coupon periods. The days between the settlement date and the next coupon period is 45. There are 90 days in the coupon period. Suppose that the bond purchased has a coupon rate of 8.0% and there are four quarterly coupon payments remaining. Face value is $100.
a) What is the dirty price of this bond if a 5.6% discount rate is used (assume that 5.6% is compounded quarterly)?
b) What is the accrued interest for this bond?
c) What is the clean price?
In: Finance