27. A two year $100 bond pays an annual coupon of 9% and has a current yield to maturity of 5% what is the Macaulay duration of the bond? a. 1.45 years b. 1.73 years c.1.92 years d. 2.00 years  e. none

Q: Gert needs to borrow $415,000 to purchase a home. He is able to obtain a thirty year mortage with a…

A: Data given: Loan amount = $415,000 N=30 year Rate=3% Monthly payment =?   Working Note #1 PV=$415000…

Q: 0) (Annuity) Payments of $400 are to be made at the beginning of each quarter for 5 years orth 8%…

A: The future value of annuity is the amount accumulated over the time and amount of interest being…

Q: With all other variables being equal (the same excerise price, underlying asset, implied volatility,…

A: We need to comment on the given statement and find out if it's true. The statement examines the…

Q: What is the discounted value of payments of $63.00 made at the end of each month for 3 years if…

A: This is a case of an annuity. Annuity is a fixed constant sum of payments that are made on a…

Q: interest rate for an annuity Personal Finance Problem Anna Waldheim was seriously injured in an…

A:

Q: According to the CAPM, the correlation coefficient between a perfectly diversified portfolio and the…

A: A portfolio is a group of investments in which an investor has invested funds or money. A portfolio…

Q: 2. The Multi-factor Arbitrage Pricing Theory Model (APT) may be valid at the same time as the…

A: We have been provided with a statement about CAPM and APT. We have to find when both of them are…

Q: Use the table below to answer questions 12 through 15. What is the annualized portfolio tracking…

A: Tracking error of a portfolio is standard deviation of the difference in the return of portfolio and…

Q: Let us suppose that you and a friend both start working at the age of 23 and decide on very…

A: Future value of money includes the amount being deposited over the period of time and amount of…

Q: h grade teachers went out for dinner in Knorvile. Their bill came out to $250, but they had a 22%…

A: The Hotel there are menu bills on which higher prices are mentioned and than discounts are given…

Q: Weisman Electronics recently paid a dividend of $2.00, the market yield (S & P 500) is 10%, the…

A: Risk free rate (Rf) = 0.04 Beta (b) = 2.5 Market return (Rm) = 0.10   Just paid dividend (D0) = $2…

Q: The management of ABC company are considering buying a new machine which would produce parts for a…

A: Machine A Initial cost  $65,000.00 Salvage Value  $  5,000.00 Cash sales  $24,000.00 Cash…

Q: Patty Purchaser purchases Blackacre, 175 acres of unimproved land for $4 million. Three years later,…

A: We have to find the tax consequence of the sale of land.

Q: $6.22, Call long call and th

A: So  you paid premium  =For X1 = 35, P1=9.12,  For X2 =40 Premium P2  Paid= 6.22 For X 3=45, Premium…

Q: Calculate the accrued interest (in $) and the total proceeds (in $) of the bond sale. (Round your…

A: Data given: Coupon rate=10.925% Formula to be used SI=P x R% x T   Note: Assumed 360 days in a year

Q: Suppose the Russell 2000 Index has an expected annual return of 7.8% and volatility of 9.8%. Suppose…

A:

Q: On July 15, 2021, M.W. Morgan Distribution sold land for $49.2 million that it had purchased in 2016…

A: Answer   Cash flow from investment activities              Indirect method  Cash flow from…

Q: n from Stan bic bank ltd      4 billion 12% preferred stock                                  1…

A: Weighted average cost of capital is weighted average cost of equity,weighted cost of debt and…

Q: Annuity due Reginald is about to lease an apartment for 30 months. The landlord wants him to make…

A: The rate charged by the Federal reserve bank to commercial banks on loans for short periods is…

Q: Verify the local analysis of the bond pricing equation nearr=β/α.

A: Introduction: The purpose of this analysis is to verify the local analysis of the bond pricing…

Q: Consider a portfolio consisting of 2 assets with a fixed correlation coefficient in a Markowitz…

A: Portfolio expected return With weight of asset 1 (W1), weight of asset 2 (W2), return on asset 1…

Q: You have been asked to compare three alternative investments and make a recommendation. ¨• Project…

A: Concept. Net present value(NPV)  is calculated by deducting initial investment from present value of…

Q: The forward price of wheat for delivery in six month is $6.88 per bushel, while the spot price is…

A: We have the forward and spot prices. We need to find the implied repo rate.

Q: Assume u have bought a CDS with the market value of 1,000,000 dollar and and the spread appreciated…

A: The spread on a CDS changes. We have to find the new MV of the spread.

Q: It is argued that interest rate should be allowed to an extend of inflation rate so that lender…

A: Relation between inflation and interest rate-When inflation rises, the FED uses its primary tool to…

Q: Size impacts the types of products and services a commercial bank off type of activities it…

A: Small banks have limited operations and limited exposure and limited type services and limited…

Q: Exxon Mobil has excess inventory of 60 million barrels of WTI crude oil and the company needs to…

A: We have to find an appropriate hedging strategy for the inventory in hand.

Q: You purchased three condos for $180,000 with loan and insurance payments of $2,300 a month for the…

A: Housing expenses include Loan and interest payments, Insurance payments, Taxes, Utility bills, and…

Q: One of the major differences between translation methods is which balance sheet components are…

A: The translation method of balance sheet accounting is related to conversion of balance sheet assets…

Q: A bond with a face value of $1,000 pays 6% annual coupon on a semiannual basis. The maturity is 8…

A: The face Value is $1,000 The annual Coupon rate is 6% Yield to maturity is 12% To Find: Duration of…

Q: Calculate the sales charge (in $) and sales charge percent for the mutual fund. (Round percents to…

A: Solution:- Sales charge means the extra amount paid by the investor to the broker over and above the…

Q: Jackie and Joanie take out a mortgage. Their annual property taxes are $1688 and their annual…

A: A mortgage is a loan taken to purchase a house and is secured by the property purchased as…

Q: You buy a property valued at $4,000,000 and finance your purchase with a 70% LTV loan. The bank…

A: The value of the property is $4,000,000 The time period is 20 years The interest rate is 5%…

Q: e. Company A has higher cost of goods sold, the same operating expenses, and lower interest expense…

A: Gross profit is the profit after the cost of goods sold and operating margin is after operating…

Q: Answer the following as indicated. (Format: problem, then, solution) 1. Brian borrowed from his…

A: Given: Borrowed amount = 9,000 Repaid amount = 9,600 Periods = 15 months

Q: You have been offered to invest in a business project. The project would require you to make an…

A: Net present value (NPV): The net present value is a technique used for making the investment…

Q: What would be the upper bound of the 95% confidence prediction interval for the following returns:…

A: Standard deviation refers to the square root of variance. It shows the dispersion of the average…

Q: How to transfer this into excel using financial functions. : NPV = -4000 + 4000(P/F, i%, 48) +…

A: P/F functions means determining the present value when future value is provided. Here, i% is 1% and…

Q: You have been asked to evaluate the proposed purchase of a new machine by your company. The  price…

A: According to bartley guidelines , if question involves multiple sub parts , then 1st sub 3 parts…

Q: A convertible bond pays interest annually at a coupon rate of 4 percent on a par value of $1,000.…

A: We have convertible bond here. We need to find the floor price of this bond.

Q: You are the manager of a pharmaceutical company and are considering what type of laptop computers to…

A: The question is related to Capital Budgeting. Annual Equivalent Cash Flow Technique:- When life of…

Q: The current price of a 3*6 Euribor FRA is 1.500% while the Euribor yield curve prevailing today is…

A: We have a yield curve and an FRA available. We need to find if there is an arbitrage opportunity. We…

Q: Answer the following as indicated. (Format: problem, then, solution) 6. Calculate the dividends paid…

A: The question is related to Dividends. Dividend paid is calculated with the help of following…

Q: The spot asset price is $53. A call on the asset with a strike price of $54 has a premium or of…

A: Concept. Intrinsic value of the option means difference between spot price and  strike price of the…

Q: The FDIC insures bank deposits and the OTS insures thrift Select one: O True

A: The depositors deposit money in the banks and that deposit is not insured and for the safety of…

Q: Discuss the meaning of the term “relevant cash flow” in the context of investment appraisal, giving…

A: We have to explain the term "Relevant cash flows" and provide some examples.

Q: Answer the following as indicated. (Format: problem, then, solution) 8. A bond with a face value of…

A: Bonds Interest = Face Value * Coupon Rate

Q: Which of the following is not related to the control of purchase of goods and services? O Approval…

A: Several measures have been suggested as a control of purchase of goods and services. We have to find…

Q: (Calculating project cash flows and NPV) Weir's Trucking, Inc. is considering the purchase of a new…

A: Since you have posted multiple questions, we will provide the solution only to the specified sub…

Q: Your client has the following goals: to totally remove the value of certain assets from her gross…

A: Given - totally remove the value of certain assets from her gross estate - to receive a stream of…