An investor buys a 30-year bond with a $1,000 face value for $950. The bond's coupon rate

Fantastic news! We've Found the answer you've been seeking!

Question:

An investor buys a 30-year bond with a $1,000 face value for $950. The bond's coupon rate is 5 percent and interest payments are made semi-annually. Using the YTM (yield to maturity) approximation formula, what is the bond's yield to maturity?

Related Book For answer-question

Contemporary Engineering Economics

ISBN: 978-0136118480

5th edition

Authors: Chan S. Park

See More Books

Posted Date: Apr 22, 2024 01:02 AM

See More Questions

Calculate the price of a 3 year bond with a face value of $10000, coupon rate of 7% annually and annual market yield of 7% annually. Coupon payments are made semi annually. Q3) What is the yield to...
A sequential circuit has one D Flip Flop. Given the following equations: D=QX' o Y = Q' X . Determine the input equation, the output equation and the next state equation Q(t+1). . Derive the...
Suppose that n distinguishable particles are placed randomly into N boxes (states). A particular configuration of this system is such that there are n, particles in state s, where 1 s N. The ordering...
The North American and European continents are moving apart at a rate of about 3 cm/y. At this rate how long will it take them to drift 500 km farther apart than they are at present?
The average body temperature of a person rises by about 2C during strenuous exercise. What is the rise in the body temperature in (a) K, (b) F, and (c) R during strenuous exercise?
According to your own personal interests, use one of the common combinations PHP/Python and MySQL or JSP and Oracle to attach a database to your personal Web site. Test it locally and then move it to...
As a hospital administrator of a large hospital, you are concerned with the absenteeism among nurses aides. The issue has been raised by registered nurses, who feel they often have to perform work...
Lucetta orders 2 0 pounds of flour from Baking World at $ 5 per pound. Upon receipt of the order, Baking World ships the flour. Is this a contract for the sale of goods? If Baking World ships 1 0...
Ravi has not kept accurate accounting records during the financial year. He had opening inventory of $10,000 and purchased goods costing $120,000 during the year. At the year end, he had $9,000 left...
Coastal Processes How does the weave refraction at a rocky point result in concentration of wave energy at the point? What is the difference between plunging and spilling breakers? What are the...
In your opinion, how did the mechanization has revolutionized the construction industry? Support your answer with examples.
What is a product life cycle? At what point in a product or service life cycle is project management used? When is process management used? What is the difference between project and process...
For many astute investors, the most important variable of business plans is Blank______. Multiple choice question. the idea financial projections the environmental context the people
What are some advantages to using equity to fund your assets? (select all that apply) Group of answer choices No fixed repayment schedule Keep full control of your company Increases your stock price...
Draft a press release like you would if you were working in a pr role. since this situation is made up, you'll have fill in any missing details. in this case you would make up a quote. in the real...
What are multinational corporations (MNCs) and what economic roles do they play?
How can we effectively analyze a firm's financial ratios?
BlackBerry Ltd. has a target current ratio of 2.0 but has experienced some difficulties financing its expanding sales in the past few months. At present, the firm has current assets of $750,000 and a...
In 2019, Italia Mining Corporation had sales of $$69$ million, total assets of $$45$ million, and total liabilities of $$23$ million. The interest rate on the debt is 6.5 percent, and its tax...

An investor buys a 30-year bond with a $1,000 face value for $950. The bond's coupon rate

Question:

Expert Answer:

To calculate the bonds yield to maturity YTM using the YTM approximation formula we n... View the full answer

Contemporary Engineering Economics

Students also viewed these finance questions