An analyst has calculated the CVA for a 4-year 6% $100 annual coupon paying bond to be

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

Question:

An analyst has calculated the CVA for a 4-year 6% $100 annual coupon paying bond to be 4.256. If the risk-free rate was 2%, what would be the fair value of the risky bond? Give your answer correct to 3 decimal places.

Related Book For answer-question

Accounting What the Numbers Mean

ISBN: 978-0073527062

9th Edition

Authors: David H. Marshall, Wayne W. McManus, Daniel F. Viele,

See More Books

Posted Date: Apr 03, 2024 07:44 PM

See More Questions

CANMNMM January of this year. (a) Each item will be held in a record. Describe all the data structures that must refer to these records to implement the required functionality. Describe all the...
1 What are the main components of personal financial planning? Solve What is the purpose of a financial plan? Solve Identify some common actions taken to achieve financial goals. How does a job...
Develop body of the method count(String[] arr) that takes an array of strings as argument, and prints how many times each digits '1'- '9' occurred in the strings. For example, if the method is called...
Use a histogram to graph the cumulative frequencies. Use the following information to answer question. Suppose a class of high school seniors had the following distribution of SAT scores in English....
What is the breakeven point?
An adiabatic pump is used to increase the pressure of water from 100 kPa to 500 kPa at a rate of 400 L/min. If the efficiency of the pump is 75 percent, the maximum temperature rise of the water...
The annual sales for Saudi Aramco Corporation were $4.7 million last year. All sales are on credit. The firms end-of-year balance sheet was as follows: The firms income statement for the year was as...
A company has a factory that is designed so that it is most efficient (average unit cost is minimized) when producing 15,000 units of output each month. However, it has an absolute maximum output...
1. 120g of an organic compound that contains only carbon and hydrogen gives 330g of CO2 and 270g of water on complete combustion. The percentage of carbon and hydrogen, respectively are (a) 25 and 75...
The cantilever beam AB is of uniform cross section and carries a load P at its free end A (Fig. 9.9). Determine the equation of the elastic curve and the deflection and slope at A. Fig. 9.9 B Fig....
1. Most companies use metrics and perform measurements, list some general principles of what constitutes a KPI for projects and how to use it. 2. Explain different complexities and critical issues...
Business communication questions- Importance of written communication importance of spoken communication importance of nonverbal communication (gesture, posture, etc) Could you give me an idea for...
A 10 kg lamp is suspended in the position shown. The un-stretched spring AB is 0.3 m and the spring has spring constant k= 200 N/m. a) What is the weight of the lamp in Newton? b) Draw a detail...
A car is being tested on a circular track having a radius of 5 0 0 m . At the moment the car's velocity is directed north, the car's acceleration is directed west and has a magnitude of 5 m / s ....
discuss the ways in which culture may affect business communication and the ways in which intercultural communication competence can be achieved. 2. "communication involves the dynamic interaction of...
1 YOUR NAME: 2 Asset # 3 Asset name: 4 Date acquired: 5 Cost: 6 Depreciation method: 7 Salvage (residual) value: 8 Estimated useful life (years): 9 222 Computer 1/1/2018 $50,000 Straight Line (SL)...
Realistic application of constitutional principles depends on: A. The hypocrisy of politicians. B. The absolutist language of the document. C. An understanding of the motives of the Framers. D....
In Exercises 105108, evaluate each expression without using a calculator. log(ln e)
It is best for a country never to borrow from foreign lenders. Do you agree or disagree? Why?
Rewrite the Account class to store the balance as a BigDecimal object and to perform all calculations using BigDecimals. Account class 2 3 4 5 6 7 // Fig. 7.8: Account.java // Account class with a...
Modify the DrawStars example so that all the stars have Rotate transition animations that execute indefinitelythat is, set each animations cycle count to Animation.INDEFINITE. DrawStars example //...

An analyst has calculated the CVA for a 4-year 6% $100 annual coupon paying bond to be

Question:

Expert Answer:

Heres how to calculate the fair value of the risky bond 1 Calculate the present value of co... View the full answer

Accounting What the Numbers Mean

Students also viewed these finance questions