Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. martin shipping lines issued bonds 10 years ago at

Martin Shipping Lines issued bonds 10 years ago at $1,000 per bond. The bonds had...

80.2K

Verified Solution

Question

Accounting

Martin Shipping Lines issued bonds 10 years ago at $1,000 per bond. The bonds had a 30-year life when issued, with semiannual payments at the then annual rate of 13 percent. This return was in line with required returns by bondholders at that point, as described below: Real rate of return 5 % Inflation premium 4 Risk premium 2 Total return 11 % Assume that today the inflation premium is only 1 percent and is appropriately reflected in the required return (or yield to maturity) of the bonds. Compute the new price of the bond. Use Appendix B and Appendix D. (Round "PV Factor" to 3 decimal places. Do not round intermediate calculations. Round the final answer to 2 decimal places.)

New price of the bond $

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Physics
1.2K views

d 4 1 A moving hydrogen atom makes a head on collision with a stationary...

Physics
1.2K views

testing a scientific hypothesis involves four main steps. examine each of these steps in detail.

Advance Math
1.2K views

If a function assigns 0 or 1 to each switching function of n variables, how many such...

Physics
1.2K views

1 Is the critical angle greater for green light or blue light What does this...

Physics
1.2K views

The young s modulus of material of a thin ring shaped elastic body is Y...

Statistics
1.2K views

Calculate the standard score of the given X value X 90 4 where Round the...

Algebra
1.2K views

1 point The sum of two consecutive even integers is at most 400 The pair...

Algebra
1.2K views

Find the quotient 58 6 0 79 58 6 0 79 Round to the nearest...

Accounting
1.2K views

Q3. Barrel Bottom Brewing Corp. manufactures and sells beer. A substantial amount of its sales...

Accounting
1.2K views

Tomo is a sole proprietor and owns a restaurant. When the economy falters, he is...

Accounting
1.2K views

Tracy Company, a manufacturer of air conditioners, sold 210 units to Thomas Company on November...

Accounting
1.2K views

The third row of o stem-and-leaf chart appears as follows: 15/1357. Assume whole number values....