One year ago alpha supply issued 15-year bonds at par the, Ask an Expert

Finance

One year ago, Alpha Supply issued 15-year bonds at par. The bonds have a coupon rate of 6.5 percent and pay interest annually. Today, the market rate of interest on these bonds is 7.2 percent. How does the price of these bonds today compare to the issue price?

4.99 percent lower

5.38 percent lower

6.05 percent lower

0.07 percent higher

1.36 percent higher

View complete question

Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M9866433

Have any Question?Write your Review or question?

Related Questions in Basic Finance

A life-cycle cost lcc analysis is being used to help

A life-cycle cost (LCC) analysis is being used to help determine whether the purchase of a high-performance heating ventilating and air conditioning (HVAC) system is cost-effective or not. This analysis would customarily ...

Old xyz corp has total assets of 1000000 and a debt ratio

Old XYZ Corp has total assets of $1,000,000 and a debt ratio of 30%. Currently it has sales of $2,500,000, total fixed costs of $1,000,000, and EBIT of $50,000. If XYZ pays 6% interest on debt, what is XYZ's ROE?

What is the present value of 10000 to be received in 6

What is the present value of $10,000 to be received in 6 years? Your required rate of return is 8% per year. Please show the explanation of work so i will be able to figure out other calculations.

Ebeneezer scrooge jasper currently manages a 500000

Ebeneezer Scrooge Jasper currently manages a $500,000 portfolio. He is expecting to receive an additional $250,000 from a new client. The existing portfolio has a required return of 10.75 percent. The risk-free rate is 4 ...

What functional roles does marketing research play the

What functional roles does marketing research play the development of a marketing decision? Give an example of each role.

A firm is considering the two mutually exclusive

A firm is considering the two mutually exclusive investments projects. Project Alpha requires an initial outlay of $600 and will return $160 per year for the next seven years; Project Beta requires an initial outlay of $ ...

Market-value ratios garret industries has a priceearnings

(?Market-value ratios?) Garret Industries has a? price/earnings ratio of 19.46X a. If? Garret's earnings per share is ?$1.65?, what is the price per share of? Garret's stock? b. Using the price per share you found in par ...

Why does eps decrease if a companies additional capital it

Why does EPS decrease if a companies additional capital it wants is obtained by issuing more shares? How would it affect a companies decision about issuing equity to try and raise their capital? What would be the firms d ...

You have just leased a car that has monthly payments of 365

You have just leased a car that has monthly payments of $365 for the next 4 years with the first payment due today. If the APR is 6.84 percent compounded monthly, what is the value of the payments today? $13,979.07 $15,3 ...

Long term financing stock valuation problem -two stage

LONG TERM FINANCING: STOCK VALUATION PROBLEM - Two Stage Dividend Discount Model: Allied Equipment Plc. a producer of agricultural farming materials and equipment has paid constant quarterly dividends for the years. Howe ...

4,153,160 Questions Asked
13,132 Experts
2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Recent Questions

Ask Basic Finance Expert