## Answers

YTM of Bond is the Rate at which Pv of cash Inflows are equal to Bond Price today.

Year | CF | PVF @8% | Disc CF |

0 | $ -960.07 | 1.0000 | $ -960.07 |

1 | $ 70.00 | 0.9259 | $ 64.81 |

2 | $ 70.00 | 0.8573 | $ 60.01 |

3 | $ 70.00 | 0.7938 | $ 55.57 |

4 | $ 70.00 | 0.7350 | $ 51.45 |

5 | $ 70.00 | 0.6806 | $ 47.64 |

5 | $ 1,000.00 | 0.6806 | $ 680.58 |

NPV | $ 0.00 |

Thus YTM is 8%.

Price after 1 Year = PV of Future CFs from it.

Year | CF | PVF @8% | Disc CF |

1 | $ 70.00 | 0.9259 | $ 64.81 |

2 | $ 70.00 | 0.8573 | $ 60.01 |

3 | $ 70.00 | 0.7938 | $ 55.57 |

4 | $ 70.00 | 0.7350 | $ 51.45 |

4 | $ 1,000.00 | 0.7350 | $ 735.03 |

Price of Bond after 1 year | $ 966.88 |

#### Similar Solved Questions

1 answer

##### Check My Work eBook Problem Walk-Through You are considering an investment in Justus Corporation's stock, which...

Check My Work eBook Problem Walk-Through You are considering an investment in Justus Corporation's stock, which is expected to pay a dividend of $1.50 a share at the end of the year (D = $1.50) and has a beta of 0.9. The risk-free rate is 5.4%, and the market risk premium is 5.5%. Justus current...

1 answer

##### Saginaw Inc. completed its first year of operations with a pretax loss of $700,000. The tax...

Saginaw Inc. completed its first year of operations with a pretax loss of $700,000. The tax return showed a net operating loss of $875,000, which the company will carry forward. The $175,000 book-tax difference results from excess tax depreciation over book depreciation. Management has determined th...

1 answer

##### Below are descriptions of some research studies. Each description contains sufficient information to determine the correct...

Below are descriptions of some research studies. Each description contains sufficient information to determine the correct statistical test to use. Your task is 1) to determine which is the correct test, 2) to perform that test using our five-step hypothesis testing procedure, and 3) to make a decis...

1 answer

##### A pro on entersthe ur form elect 1c field produced brtheti o charged pl es snow...

A pro on entersthe ur form elect 1c field produced brtheti o charged pl es snow belaw. below. The magnt de ofthe electric feld Is g 7 The magn tude af the electric 10s N , and the speed o the proton when it e 15 1.6 x 10' m s what distance d in m has the proton been deflected downward when it ea...

1 answer

##### How do i write out a reference for the following: It is a poem (it has an author and date) in one of my books (the book cover has a different authors then the one in the poem) this is what i think but i am not sure: authors name (date)

How do i write out a reference for the following:It is a poem (it has an author and date) in one of my books (the book cover has a different authors then the one in the poem)this is what i think but i am not sure:authors name (date). title. In title of book (edition). State: publisheror should I als...

1 answer

##### How do you simplify #7 - 25 + 6 / 2 times 25# using order of operations?

How do you simplify #7 - 25 + 6 / 2 times 25# using order of operations?...

1 answer

##### Please help The following financial statements and additional information are reported. 2018 IKIBAN INC. Comparative Balance...

please help The following financial statements and additional information are reported. 2018 IKIBAN INC. Comparative Balance Sheets June 30, 2019 and 2018 2019 Assets Cash $ 87,500 Accounts receivable, net 65,000 Inventory 63,800 Prepaid expenses 4,400 Total current assets 220,700 Equipment 124...

1 answer

##### Will rate, answer quickly An input noise process n;(t) having a PSD that is constant between...

Will rate, answer quickly An input noise process n;(t) having a PSD that is constant between 200 and 700 rad/s (the power density is 10-W/Hz in the passband 200 to 700 rad/s) is the input to a lowpass filter whose bandwidth is 500 rad/sec and gain is 1. Do not forget that the spectrum and the freque...

1 answer

##### A discrete random variable, X, has the following probability distribution: P(X) lorem What is the probability...

A discrete random variable, X, has the following probability distribution: P(X) lorem What is the probability that X is not more than 1? (b) What is the probability that X is at least 22|| What is the mean of X? (d) What is the standard deviation of X?...

1 answer

##### What is the tenth term of the geometric sequence with a4 = 16 and r = 2?

What is the tenth term of the geometric sequence with a4 = 16 and r = 2?...

1 answer

##### Which statement is NOT true? A. Not only quantitative variables have a mode B. The arithmetic...

Which statement is NOT true? A. Not only quantitative variables have a mode B. The arithmetic mean can be calculated from any variables. C. The median can always be determined from quantitative variables...

1 answer

##### It is known that f :(0,2) + R is a differentiable function such that \f'(x) <...

It is known that f :(0,2) + R is a differentiable function such that \f'(x) < 5 for all x € (0,2). Now let bn := f(2 – †) for all n € N. Prove that this is a Cauchy sequence....

1 answer

##### Recording Entries Using Composite Depreciation Method California Utilities owns a power plant that consists of the...

Recording Entries Using Composite Depreciation Method California Utilities owns a power plant that consists of the following assets, all acquired on January 1, 2020. Estimated Estimated Residual Life Cost Value (Years) Building $120,000 $4,000 30 Machinery 38,000 10 Other equipment 20,000 2,000 6 0 ...

1 answer

##### Body of mass 7 kg moves in a (counterclockwise) circular path of radius 4 meters, making one revolution every 13 seconds

body of mass 7 kg moves in a (counterclockwise) circular path of radius 4 meters, making one revolution every 13 seconds. You may assume the circle is in the xy-plane, and so you may ignore the third component. how do you find the centripetal force acting on the body how do you find the magnitude of...