How much do you pay for a zero coupon government bond that has a term of 30

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

Question:

How much do you pay for a zero coupon government bond that has a term of 30 years, an interest rate of 10%, and a par value of $1000.

Related Book For answer-question

Microeconomics

ISBN: 978-0132857123

8th edition

Authors: Robert Pindyck, Daniel Rubinfeld

See More Books

Posted Date: Feb 26, 2024 04:24 AM

See More Questions

A bonds are traded in the market at 10% YTM at all maturities, and you buy an A grade 10 year bond with a 9% coupon, a face value of $1,000 and an annual coupon payment.Let's say immediately after...
A bond has a coupon rate of 9% p.a. The coupons are paid every 6 months. The bond has a $1,000 face value and is priced at par value. The bond has 16 years to maturity. If interest rates suddenly...
For each problem, show your work steps. A correct answer with no work shown gets half credit (which means you fail the assignment). An incorrect answer with no work receives 0 credit. With time value...
The following table includes transactions carried out by Ram Horn Corporation, as well as columns for each of the three categories found in the statement of cash flows: operating, financing, and...
(a) For each data set, calculate the mean, median, and mode. (b) Which, if any, of these three measures is the weakest indicator of a "typical" data value? Why? a. Number of e-mail accounts (12...
What is the geometry of each species? a. CN b. PO43
Given that $f(x)=\frac{k}{2^{x}}$ is a probability distribution for a random variable that can take on the values $x=$ $0,1,2,3$, and 4 , find $k$.
Of the many reimbursements and allowances that U.S. companies make for employees who take foreign assignments, which one is the most essential? Discuss your reasons.
Presented below is information related to Sunbuck's Coffee Club for its fiscal year ending April 30, 2023. During the year, the Board of Directors decided to discontinue the operations of its entire...
ZIM Inc. (ZIM) is a high-technology company that develops, designs, and manufactures telecommunications equipment. ZIM was founded in Year 5 by Dr. Alex Zimmer, the former assistant head of research...
There are 10 white and 10 black. balls marked 1, 2, 3, ---, 10 and we can arrange. these balls in a row such that neighbouring balls are of different colours. Find! Number of ways of arrangement.
If we assume 10% of the energy put in for crushing/grinding leads to heat generation then will more heat will be generated to break particles from 10 to 5 mm, or from 1 to 0.5 mm?
a. Does your state allow covenant marriage? If so, describe its components. b. Explain why you think it is a good or bad idea for every state to force couples to choose between conventional and...
Assume that TCP implements an extension that allows window sizes much larger than 64 kB. Suppose that you are using this extended TCP over a 1-Gbps link with a latency of 100 ms to transfer a 10-MB...
Let W W be a Brownian motion, F F its natural filtration and M t = sup s t W s M t = sup s t W s . Prove that, for t < 1 t < 1 , E ( f ( M 1 ) F t ) = F ( 1 t , W t , M t ) E ( f ( M 1 ) F t ) =...
XYZ automobiles, Inc. makes accessories primarily for cars.For 2017, budgeted variable overhead is $$90,000$ for 12,000 direct labor-hours. Budgeted total overhead is $$110,000$ at 8,000 direct...
Rent-A-Car Project Datasets and description for the case assignments: http://www.washburn.edu/sobu/dnizovtsev/RentacarCase.html Estimate the demand for economy vehicles using the variables provided,...
Sportique Boutique reported the following financial data for 2012 and 2011. Instructions(a) Calculate the current ratio for Sportique Boutique for 2012 and 2011.(b) Suppose that at the end of 2012,...
Suppose that two identical firms produce widgets and that they are the only firms in the market. Their costs are given by C1 60Q1 and C2 60Q2, where Q1 is the output of Firm 1 and Q2 the output of...
Is the firms expansion path always a straight line?
Why do some investors put a large portion of their portfolios into risky assets, while others invest largely in risk-free alternatives?
True or False: Benefits and disbenefits must be converted to monetary values to use benefit-cost analysis.
Using an Internet-based search on 'build operate transfer," find an additional definition from a source other than used in Section 14.2. Copy and paste it, as well as any graphics, examples,...
Elm City is considering a replacement for its police radio. The benefits and costs of the replacement are shown below. What is the replacement's benefit/cost ratio if the effective annual interest...

How much do you pay for a zero coupon government bond that has a term of 30

Question:

Expert Answer:

To calculate the price of the zero coupon bond we use ... View the full answer

Microeconomics

Students also viewed these finance questions