Question: please help by showing work ABC Co., has a 7.9% bond with a face value of $1,000, which pays interest semiannually, mature in 17 years.

please help by showing work

ABC Co., has a 7.9% bond with a face value of $1,000, which pays interest semiannually, mature in 17 years. The yield to maturity is 7%. What is its current price? Round your answer to two decimal places. Enter a POSITIVE number. Question 14 Suppose ABC's expected dividend next year (i.e. Period 1) is $3.5. If its dividend is likely to grow at a constant rate of 7.6% forever, compute its stock value in Period 4 when the required rate of return is 11.6%. Round your answer to two decimal places

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

1. A firm has $480 in fixed assets, $162 in current liabilities, $147 in long-term liabilities, and $409 in shareholders' equity. What is the amount of the net working capital? 2. ABC Co., has a 6.5%...

ABC Co., has a 6.1% bond with a face value of $1,000, which pays interest semiannually, mature in 18 years. The yield to maturity is 7.7%. What is its current price? Round your answer to two decimal...

ABC Co., has a 7.7% bond with a face value of $1,000, which pays interest semiannually, mature in 14 years. The yield to maturity is 7.4%. What is its current price? Round your answer to two decimal...

1. Consider a 20-year 8% coupon-paying bond with a face value of $1,000 that pays interest semi-annually. If the yield to maturity is stated to be 6% annually, what is the price of this 20-year 8%...

1. Consider a 10-year 4%coupon-paying bond with a face value of $1,000 that pays interest semi-annually. If the yield to maturity is 5%, what is the price of this 10-year 4%coupon bond that pays...

Context: Earlier Question: Consider a 10-year 4% coupon-paying bond with a face value of $1,000 that pays interest semi-annually. If the yield to maturity is 5%, what is the price of this 10-year 4%...

1. Using the table above, what is the maximum that an investor should be willing to pay for the share of common stock? 2. Sally was contemplating the purchase of a stock priced at $55/share, but is...

Please show your work step by step and related formulas used. Question 1. What is the expected constant-growth rate of dividends for a stock with a current price of $87, an expected next period...

Please try showing the steps with TI BA II calculator, and explain the variables when needed. ABC company just issued a bond with the face value of $1,000, with annual coupon rate of 8% with the...

What are the total expected cash collections for the year under this revised budget? What is the total required production for the year under this revised budget? Data Budgeted unit sales Selling...

Mathematical analysis of the rolling of flat strip reveals that the roll-separation force (the squeezing force required to deform the strip) is directly proportional to the term 1 + K1mL / tav where...

content area top Part 1 Calculate the amount of money you'll have at the end of the indicated time period, assuming that you earn simple interest. You deposit $3000 in an account with an annual...

10) For a bond that pays cash interest (i.e., not a zero coupon bond), YTM is (a) always equal to the coupon rate (b) always equal to the current yield (c) is always less than the coupon rate (d) can...

Teamwork. Obtain a copy of your schools administrative organization chart.As a group, identify the vertical and horizontal communication patterns suggested by the structure. Then, interview one of...

Which communication barriers do you consider to be more serious, verbal or nonverbal? (Objective 5)

What techniques can the sender of a message use to ensure that serial communications are accurate?