Questions from Financial Markets

Q: A $1,000 face value bond issued by the Dysane

A $1,000 face value bond issued by the Dysane Company currently pays total annual interest of $79 per year and has a 13-year life. a. What is the present value, or worth, of this bond if investors are...

Q: a. You own a two-bond portfolio. Each has

a. You own a two-bond portfolio. Each has a par value of $1000. Bond A matures in 5 years, has a coupon rate of 8 percent, and has a annual yield to maturity of 9.20 percent. Bond B matures in 15 year...

Q: A bond with a par value of $1000 has a coupon

A bond with a par value of $1000 has a coupon rate of 7 percent and matures in 15 years. Using a spreadsheet program, graph its price versus different yields to maturity, ranging from 1 percent to 20...

Q: Global Cycles (GC) offers investors a DRIP program. An

Global Cycles (GC) offers investors a DRIP program. An investor purchases 100 shares of GC at a price of $20 per share on January 2. How many shares will the investor own on December 31 if the followi...

Q: Judy Johnson is choosing between investing in two Treasury securities that both

Judy Johnson is choosing between investing in two Treasury securities that both mature in five years and have par values of $1,000. One is a Treasury note paying an annual coupon of 5.06 percent. The...

Q: If a stock’s earnings per share is $2.00 what

If a stock’s earnings per share is $2.00 what will be the dividend per share if the payout ratio is 40%? If the following year’s earnings per share is $2.10 what will the payout ratio be if the firm w...

Q: You purchased 200 shares of H2O Corporation stock at a price of

You purchased 200 shares of H2O Corporation stock at a price of $20. Consider each of the following announcements separately. What will the price of the stock be after each change? How many shares wil...

Q: 1. What is the net difference between a country’s import and

1. What is the net difference between a country’s import and export of goods called its a. Balance of payments b. Balance of trade c. Merchandise trade balance d. Current account 2. What is a su...

Q: The Fridge-Air Company’s preferred stock pays a dividend of $

The Fridge-Air Company’s preferred stock pays a dividend of $4.50 per share annually. If the required rate of return on comparable quality preferred stocks is 14 percent, calculate the value of Fridge...

Q: The Joseph Company has a stock issue that pays a fixed dividend

The Joseph Company has a stock issue that pays a fixed dividend of $3.00 per share annually. Investors believe the nominal risk-free rate is 4 percent and that this stock should have a risk premium of...