L.a.r.g.a. .I.n.d.u.s.t.r.i.e.s. .h.a.s. .o.u.t.s.t.a.n.d.i.n.g. . $1,000 p.a.r. .v.a.l.u.e. .b.o.n.d. .w.i.t.h. a.n. 8% c.o.u.p.o.n. .i.n.t.e.r.e.s.t. .r.a.t.e... .T.h.e. .b.o.n.d. .h.a.s. 12 y.e.a.r.s. .r.e.m.a.i.n.i.n.g. .t.o. .i.t.s. .m.a.t.u.r.i.t.y. .d.a.t.e. a. I.f. t.h.e. .i.n.t.e.r.e.s.t. .i.s. .p.a.i.d. .a.n..nu.a.l.l.y.,. .f.i.n.d. .t.h.e. .v.a.l.u.e. .o.f. .t.h.e. .b.o.n.d. .w.h.e.n. .t.h.e. .r.e.q.u.i.r.e.d. .r.e.t.u.r.n. .i.s. (1) 7%, (2) 8%, (3) 10%. b. I.n.d.i.c.a.t.e. .f.o.r. .e.a.c.h. .c.a.s.e. .i.n. .p.a.r.t. .w.h.e.t.h.e.r. .t.h.e. .b.o.n.d. .i.s. .s.e.l.l.i.n.g. .a.t. .a. .d.i.s.c.o.u.n.t.,. .a.t. .a. .p.r.e.m.i.u.m.,. .o.r. .a.t. .i.t.s. .p.a.r. .v.a.l.u.e. c. U.s.i.n.g. .t.h.e. . 10% r.e.q.u.i.r.e.d. .r.e.t.u.r.n.,. .f.i.n.d. .t.h.e. .b.o.n.d.’.s. .v.a.l.u.e. .w.h.e.n. .i.n.t.e.r.e.s.t. .is. .p.a.i.d. .s.e.m.i.-.a.n.n.u.a.l.l.y..
L.a.r.g.a. .I.n.d.u.s.t.r.i.e.s. .h.a.s. .o.u.t.s.t.a.n.d.i.n.g. . $1,000 p.a.r. .v.a.l.u.e. .b.o.n.d. .w.i.t.h. a.n. 8% c.o.u.p.o.n. .i.n.t.e.r.e.s.t. .r.a.t.e... .T.h.e. .b.o.n.d. .h.a.s. 12 y.e.a.r.s. .r.e.m.a.i.n.i.n.g. .t.o. .i.t.s. .m.a.t.u.r.i.t.y. .d.a.t.e. a. I.f. t.h.e. .i.n.t.e.r.e.s.t. .i.s. .p.a.i.d. .a.n..nu.a.l.l.y.,. .f.i.n.d. .t.h.e. .v.a.l.u.e. .o.f. .t.h.e. .b.o.n.d. .w.h.e.n. .t.h.e. .r.e.q.u.i.r.e.d. .r.e.t.u.r.n. .i.s. (1) 7%, (2) 8%, (3) 10%. b. I.n.d.i.c.a.t.e. .f.o.r. .e.a.c.h. .c.a.s.e. .i.n. .p.a.r.t. .w.h.e.t.h.e.r. .t.h.e. .b.o.n.d. .i.s. .s.e.l.l.i.n.g. .a.t. .a. .d.i.s.c.o.u.n.t.,. .a.t. .a. .p.r.e.m.i.u.m.,. .o.r. .a.t. .i.t.s. .p.a.r. .v.a.l.u.e. c. U.s.i.n.g. .t.h.e. . 10% r.e.q.u.i.r.e.d. .r.e.t.u.r.n.,. .f.i.n.d. .t.h.e. .b.o.n.d.’.s. .v.a.l.u.e. .w.h.e.n. .i.n.t.e.r.e.s.t. .is. .p.a.i.d. .s.e.m.i.-.a.n.n.u.a.l.l.y..
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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The Return on Equity (RoE) is a measure of the profitability of a business concerning the funds by its stockholders/shareholders. ROE is a metric used generally to determine how well the company utilizes its funds provided by the equity shareholders.
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- L.a.r.g.a. .I.n.d.u.s.t.r.i.e.s. .h.a.s. .o.u.t.s.t.a.n.d.i.n.g. . $1,000 p.a.r. .v.a.l.u.e. .b.o.n.d. .w.i.t.h. a.n. 8% c.o.u.p.o.n. .i.n.t.e.r.e.s.t. .r.a.t.e... .T.h.e. .b.o.n.d. .h.a.s. 12 y.e.a.r.s. .r.e.m.a.i.n.i.n.g. .t.o. .i.t.s. .m.a.t.u.r.i.t.y. .d.a.t.e.
a. I.f. t.h.e. .i.n.t.e.r.e.s.t. .i.s. .p.a.i.d. .a.n..nu.a.l.l.y.,. .f.i.n.d. .t.h.e. .v.a.l.u.e. .o.f. .t.h.e. .b.o.n.d. .w.h.e.n. .t.h.e. .r.e.q.u.i.r.e.d. .r.e.t.u.r.n. .i.s. (1) 7%, (2) 8%, (3) 10%.
b. I.n.d.i.c.a.t.e. .f.o.r. .e.a.c.h. .c.a.s.e. .i.n. .p.a.r.t. .w.h.e.t.h.e.r. .t.h.e. .b.o.n.d. .i.s. .s.e.l.l.i.n.g. .a.t. .a. .d.i.s.c.o.u.n.t.,. .a.t. .a. .p.r.e.m.i.u.m.,. .o.r. .a.t. .i.t.s. .p.a.r. .v.a.l.u.e.
c. U.s.i.n.g. .t.h.e. . 10% r.e.q.u.i.r.e.d. .r.e.t.u.r.n.,. .f.i.n.d. .t.h.e. .b.o.n.d.’.s. .v.a.l.u.e. .w.h.e.n. .i.n.t.e.r.e.s.t. .is. .p.a.i.d. .s.e.m.i.-.a.n.n.u.a.l.l.y..
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