Tax equivalent yield - Study guides, Class notes & Summaries

Fixed Income Securities Test 2 (Answered) Complete Solution Assume you purchased Treasury bond on November 14, with an annual coupon rate equal to 15%. At settlement you must pay accrued interest equal to $2.51. Assuming there are 182 days in a coupon period, how many days were in the AI period? Coupon of 15% = $15 per $100 of par Coupon interest per day = 15 / 364 = .0412 $2.51 / .0412 = 61 days Which of the following statements is FALSE? - all coupon treasury security can be created ...

Finance 380 Exam 2 (Answered) With Complete Verified Solution A bond with several years to maturity has a coupon rate that is greater than its yield to maturity. The bond will: have a price greater than its par value or be priced at a premium The risk that the bond issuer might not make the promised coupon and/or par value payments is referred to as: default risk What is the current yield for a bond with a par value of $1,000 and a 6% annual coupon rate if the bond sells for $900? ...

In CAPM, the expected return on a stock is directly related to its _____? A. Alpha B. Beta C. Interest Rate D. WACC E. All of the above - Answer-B Which of the following is true about bonds? A. The longer the maturity of the bond, the higher the interest rate risk B. There is a positive relationship between market interest rate movements and bond prices C. The lower the default risk on the bond, the higher the yield of the bond D. A decrease in market interest rate will decrea...

ICAEW – FM, Exam Review. Questions and answers, rated A+ Accounting Rate of Return - -Average Profit/Average investment Internal Rate of Return - -a + NPVa/NPVa-NPVb x (b-a) Money cost of capital - -(1 + money coc) = (1 + real coc%) x (1 + inflation %) Equivalent annual cost (EAC) - -PV of 1 cycle/AF^n of cycle Profitability index (for divisible projects) - -NPV/Investment in yr of rationing Sensitivity to sales volume - -NPV/PV of net contribution (after tax) Interest Rate Parity - -...

MODULE 2: FINANCIAL MANAGEMENT FROM M100 WITH COMPLETE SOLUTIONS 100% Which of the following accounting methods records revenue when it is collected and expenses when they are paid? a. cash basis b. accrual basis c. modified cash basis d. modified accrual basis a. cash basis A ___________ occurs when expenses are greater than revenue a. net income b. net loss c. net gain d. net profit b. net loss Which is not one of the 3 major components of a balance sheet? a. assets b. l...

Which of the following is a disadvantage of using the price-to-book value (PBV) ratio? - correct answer Book values are affected by accounting standards, which may vary across firms and countries. The sustainable growth rate, g, equals: - correct answer earnings retention rate times the return on equity. The present value of Raver Industries' projected residual income (RI) for the next five years is £60 per share...

Fixed Income Test 2 (Answerd) Verified Solution Two factors account for prominence of US Treasuries 1) Volume 2) Liquidity Department of Treasury = largest global single issuer of debt. Most active/liquid market in the world. All Treausury securities are noncallable. Thus, investors are not subject to call risk Marketable Treasury secs fixed-principal securities or inflation-indexed securities Treasury Bills - issued at discount - no coupon - one year or less - return to the inv...

Finance 380 Exam 2 (Answered) With Complete Verified Solution A bond with several years to maturity has a coupon rate that is greater than its yield to maturity. The bond will: have a price greater than its par value or be priced at a premium The risk that the bond issuer might not make the promised coupon and/or par value payments is referred to as: default risk What is the current yield for a bond with a par value of $1,000 and a 6% annual coupon rate if the bond sells for $900? ...

Revenue Management Final Exam Question & Answers 2024. what is the industry term used to describe the sum of prices paid by a business's customers? -daily receipts -profit -profits less expenses -total revenues -total revenues historically, what concept have hospitality managers chiefly used to calculate their selling prices? -income -revenue -costs -profits -costs what is an algebraic equivalent of the formula: sales=costs+profit? -profit=sales-costs -costs=sales+profits -costs=profit-sales -...

D) both the returns currently required by its debtholders and stockholders. - Answer-1) A company's current cost of capital is based on: E) A reduction in the risk-free rate - Answer-2) All else constant, which one of the following will increase a company's cost of equity if the company computes that cost using the security market line approach? Assume fim currently pays an annual dividend of $1 a share and has a beta of 1.2 C) is dependent upon a reliable estimate of the market risk pre...