A four year corporate bond has a default risk premium equals to 2 , maturity risk premium 1 and liquidity premium 3 The risk free rate on a T bill is 2 Calculate the return on the four year corporate bond A four year corporate bond has a default risk premium equals to 2 , maturity risk premium 1 a...

The detailed answer for the above que ...

A four year corporate bond has a default risk premium equals to 2%, maturity risk premium...

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

Question:

Related Book For answer-question

Fundamentals of Financial Management

ISBN: 978-0324664553

Concise 6th Edition

Authors: Eugene F. Brigham, Joel F. Houston

See More Books

Posted Date: Apr 10, 2023 06:41 AM

See More Questions

1. Suppose your personal federal income tax rate is 30%. You are trying to decide which of the following bonds to invest in. Both are BBB rated and therefore equally risky. State of Illinois Bond...
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...
Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
Why is it likely to have preexisting normal faults in an orogenic belt?
Different types of responsibility centers Liberty National Bank is a large municipal bank with several branch offices. The banks computer department handles all data processing for bank operations....
The following information has been obtained for the Gocker SA. 1. Prior to 2022, taxable income and pretax financial income were identical. 2. Pretax financial income is 1,700,000 in 2022 and...
Using the Newmark method with $\alpha=\frac{1}{6}$ and $\beta=\frac{1}{2}$, solve Problem 11.19. Data From Problem 11.19:- Using the central difference method, find the response of the system...
Morrissey Technologies Inc.s 2008 financial statements are shown here. Suppose that in 2009, sales increase by 10% over 2008 sales. The firm currently has 100,000 shares outstanding. It expects to...
(c) Identify the four (4) advantages of mass customization and examine with appropriate examples, how supermarkets may employ Pine and Gilmore's four (4) mass customization to create value for their...
As the manager of credit card services at Bank of Hanover (BOH), you're aware that the average profitability of a credit card customer grows with the number of years they have used the credit card....
The three objects in the figure are connected by a light cord.A triangular structure is oriented such that its base rests upon a horizontal surface, its right side is perpendicular to its base, and...
Suppose a company has 10,000 units of finished goods inventory of a particular SKU. The average demand for the SKU is 100 units per week. How many days on hand does the amount of inventory represent,...
Trinity, a 51-year-old taxpayer, earned $54,000 in wages. What is the maximum deductible amount of contribution she can make to a 401(k) plan for 2023? Show your calculations.
When air-filled, a particular parallel-plate capacitor has a capacitance of c = 16.7 F. When the gap between the plates is filled with a dielectric oil, the capacitance changes to c = 48.4 F. A...
A student is running at her top speed of 5.5 m/s to catch a bus, which is stopped at the bus stop. When the student is still a distance 38.5 m from the bus, it starts to pull away, moving with a...
Part A A loudspeaker of mass 19.0 kg is suspended a distance of h = 1.40 m below the ceiling by two cables that make equal angles with the ceiling. Each cable has a length of 1 = 3.30 m. (Figure 1)...
Shinra Inc. has two main processes, forging and packaging. Material is introduced at the start of both processes and conversion costs are applied uniformly throughout. Data for March are as follows:...
Differentiate. y = ln(3x + 1) ln(5x + 1)
What does it mean when it is said that the United States is running a trade deficit? What impact will a trade deficit have on interest rates?
What is the real risk-free rate of interest (r*) and the nominal risk-free rate (rRF)? How are these two rates measured?
Discuss the following statement: If a firm has only independent projects, a constant WACC, and projects with normal cash flows, the NPV and IRR methods will always lead to identical capital budgeting...
Calculate the CGT payable in relation to each of the following disposals, assuming in each case that the annual exemption is fully utilised against other gains, that there are no allowable losses and...
Mick Stone disposed of the following assets during tax year 2023-24: (1) On 19 May 2023, Mick sold a freehold warehouse for 522,000. This warehouse was purchased on 6 August 2011 for 258,000, and was...
In October 2012, Matthew bought a piece of rare porcelain for 10,000. The porcelain was damaged in early 2019 and in February of that year Matthew spent 3,850 on restoration work. In July 2019,...

A four year corporate bond has a default risk premium equals to 2%, maturity risk premium...

Question:

Expert Answer:

The detailed answer for the above que... View the full answer

Fundamentals of Financial Management

Students also viewed these finance questions