A 25-year, 1000-par bond pays annual coupons at a rate of 8% and has a price of

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

Question:

A 25-year, 1000-par bond pays annual coupons at a rate of 8% and has a price of 1116.54. Calculate the duration of this bond.

Related Book For answer-question

Introduction To Corporate Finance

ISBN: 9781118300763

3rd Edition

Authors: Laurence Booth, Sean Cleary

See More Books

Posted Date: May 22, 2023 12:36 AM

See More Questions

A bond pays annual coupons of $5, has a par value of $100 and a maturity of 3 years. The 1-year, 2-year, and 3-year spot rates are 4%, 4.5%, and 5%, respectively. What is the price of the bond...
Imagine a government bond with the face value of $100 and 4 years to maturity that: Pays annual coupons at a rate of 8% per annum; and, Has a yield to maturity of 7% per annum. Required What risks...
KYC's stock price can go up by 15 percent every year, or down by 10 percent. Both outcomes are equally likely. The risk free rate is 5 percent, and the current stock price of KYC is 100. (a) Price a...
Consider the heat pump described in Example 9.14. The heat pump now operates between 0.60 MPa and 1.4 MPa. Plot the vapor-compression cycle in Ts coordinates (use NIST) and determine the cycle...
The following selected accounts and their current balances appear in the ledger of Black Lab Co. for the fiscal year ended April 30, 2012: Instructions1. Prepare a multiple-step income statement2....
Consider the differential equation given by Eq. (12.2). Use a coordinate transformation $\zeta=z^{*} P e^{a}$, where $a$ is some index to be chosen suitably. Show that in the transformed equation...
Water flows from the nozzle attached to the spray tank shown in Fig. P8.86. Determine the flowrate if the loss coefficient for the nozzle (based on upstream conditions) is 0.75 and the friction...
Pitt Limited is trying to determine the value of its ending inventory as of February 28, 2017, the company's year-end. The accountant counted everything that was in the warehouse as of February 28,...
Acc-330 federal taxation Scenario You have been hired as a junior accountant at a medium-sized tax and accounting firm. Your manager would like to understand your level of knowledge of preparing a...
Show how the IS and LM schedules look in the monetarist view. Use these schedules to illustrate the monetarist conclusions about the relative effectiveness of monetary and fiscal policy.
Anugerah Carpet Cleaning is a small business operating in Rawang, Selangor. For its services, the company has always charged a flat fee per hundred square feet of carpet cleaned. The current fee is...
If all markets were contestable, there would be no need for regulation. Do you agree with this statement? Provide reasons and justifications for your answer.
Why is a time lag an important feature of a perfectly contestable market?
Why do regulators face a trade-off between competitiveness and the benefit of economies of scale in imperfectly competitive markets?
Why is costless exit as important a feature of a perfectly contestable market as costless entry?
Why were Leontiefs findings considered paradoxical? Explain.
How much was the 2016 net income under or overstated? Include if understated or overstated? How much was the balance of retained earnings as of December 31, 2016 understated or overstated? Include if...
In a nonmagnetic medium, E = 50 cos (10 9 t 8x) a y + 40 sin (10 9 t 8x) a z V/m find the dielectric constant r and the corresponding H.
1. Proponents of the efficient market hypothesis think technical analysts: a. Should focus on relative strength b. Should focus on resistance levels c. Should focus on support levels d. Are wasting...
You invested $100,000 in the following stocks: If the risk-free rate is 5 percent and the market risk premium is 8 percent, what is the expected return on yourportfolio? StockAmount Beta ABC$20,000...
Explain how the static trade-off model can be used to find an optimal capital structure.
Assume a gain margin of 20 dB and a plant with a nominal gain of 50/sec. Assume also that the minimum GM of the system is specified to 10 dB. To what maximum value of gain can the plant climb under...
Name three benefits of using software R/D conversion compared with hardware R/D converters.
Correcting for reversal error correction and deadband compensation are special cases of what general technique?

A 25-year, 1000-par bond pays annual coupons at a rate of 8% and has a price of

Question:

Expert Answer:

Introduction To Corporate Finance

Students also viewed these finance questions