Wilson Wonders' bonds have 12 years remaining to maturity. Interest is paid annually, the bonds have a $1,000 par value, and the coupon interest rate is 10 percent. The bonds sell at a price of $850. What is their yield to maturity?

Q: Define constant yield method

A: It is the method of ascertaining the collected discount of securities that trade the secondary…

Q: Explain the differences between yield-to-maturity and yield-to-call

A: While both yield to maturity and yield to call are related to bonds they are not the same thing.

Q: How is the revaluation surplus handled under the revaluation model?

A: The question is related to Revaluation model under IAS16 Property, Plant and Equipment. Under this…

Q: Explain the term Annual Effective Yields?

A: Annual effective yield: Annual effective yield is defined as the simple rate of interest that gives…

Q: How can we find Yield to maturity?

A: Yield to maturity (YTM) is the foreseen absolute profit for a bond if the bond holds until due or…

Q: Earns the median salary for a museum curator, $50,000. Is 40 years old and hasn't started saving for…

A: First, we need to calculate how much income Lucia would need in retirement to maintain 72% of her…

Q: Yield to maturity and price Seleccione una: a. Move in opposite directions in exact proportions b.…

A: The relationship between the price and interest rate is inverse.   Price will increase when interest…

Q: what is portfolio load

A: Introduction : In simple words, when an individual or an entity purchase and collect different kinds…

Q: Example or scenario of market portfolio?

A: The question is based on the concept of market portfolio, which  is a bundle of  all the assets…

Q: The VIX measures Select one: a.Realized volatility B. Current volatility C. Historical volatility D.…

A: The VIX stands for volatility index. Volatility index was the first benchmark which was created by…

Q: What is financial market equilibrium? And then explain its relation to required rate of return.

A: Financial market equilibrium: Financial market equilibrium is a condition in which money supply…

Q: What does the annual effective yield represent?

A: Yield refers to the rate of return that is received by the owner of the security who has invested in…

Q: What security provides a good estimate of the short-term nominalrisk-free rate?

A: T-bills are the treasury bills issued by the government. These bills are risk-free and the rate of…

Q: Explain APY (annual percentage yield)?

A: APY (Annual Percentage Yield):   It is the real return rate that is earned on an investment during a…

Q: what does Market's Risk premium measure

A: Market's Risk premium is an important term used in the capital asset pricing model equation (CAPM)…

Q: What security provides a good estimate of the long-term nominalrisk-free rate?

A: Risk-free Rate is the estimation of the rate that is earned on the securities or the investments…

Q: What is liquidity premium (LP)?

A: Answer: Interest rate theory on liquidity premium is a significant concept in bond investment. It…

Q: Lena Horn bought a Toyota Tundra on January 1 for $30,800 with an estimated life of 6 years. The…

A: a. Depreciation per annum = ( Cost - Salvage value) / Useful life

Q: What is maturity date?

A: Maturity dates are generally used in order to classify the securities as short term, medium term or…

Q: What is a yield curve? What does it mean when the yield curve is inverted?

A: Yield curve tells the relationship between the short term interest rates and long term interest…

Q: What is definitions of this?   Systematic risk  Risk free rate of return  Market rate of…

A: Capital asset pricing model (CAPM) can be used to compute the return expected by the investors by…

Q: Make a contrast between yield to maturity (YTM) and yield to redemption (YTC).

A: Contrast between Yield to maturity (YTM) and yield to redemption (YTC):

Q: Ayield curve states that the long-term interest rate is higher than the short-term interest rates.

A: A Yield Curve, also commonly referred to as "The Term Structure of Interest Rates", depicts the…

Q: impacts  of inflation on money investment

A: Inflation occurs when prices across a sector or an industry increases, thereby decreasing the…

Q: How does the inflation premium shape the yield curve?

A: The inflation premium is one of the components that shape the yield curve. It reflects the…

Mortgages

A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.

Mortgage

The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.