subject
Business, 29.10.2019 00:31 dthompson365

New business ventures, inc., has an outstanding perpetual bond with a coupon rate of 12 percent that can be called in one year. the bond makes annual coupon payments and has a par value of $1,000. the call premium is set at $120 over par value. there is a 60 percent chance that the interest rate in one year will be 14 percent, and a 40 percent chance that the interest rate will be 9 percent. if the current interest rate is 12 percent, what is the current market price of the bond?

ansver
Answers: 3

Other questions on the subject: Business

image
Business, 22.06.2019 09:00, valejuan
According to this excerpt, a key part of our national security strategy is
Answers: 2
image
Business, 22.06.2019 11:30, jacky852
On average, someone with a bachelor's degree is estimated to earn times more than someone with a high school diploma. a)1.2 b)1.4 c)1.6 d)1.8
Answers: 1
image
Business, 22.06.2019 21:00, elenasoaita
Describe what fixed costs and marginal costs mean to a company.
Answers: 1
image
Business, 23.06.2019 03:00, oliviacalhoun29
If big macs were a durable good that could be costlessly transported between countries, which of the following would present an arbitrage opportunity? check all that apply. exporting big macs from argentina to the united states. exporting big macs from the united kingdom to poland. exporting big macs from switzerland to china
Answers: 1
You know the right answer?
New business ventures, inc., has an outstanding perpetual bond with a coupon rate of 12 percent that...

Questions in other subjects:

Konu
Mathematics, 13.11.2020 15:50
Konu
History, 13.11.2020 15:50
Konu
Mathematics, 13.11.2020 15:50