Posted by **Gayla D** on Sunday, February 25, 2007 at 5:47pm.

Bond valuation

The Garraty Company has two bond issues outstanding. Both bonds pay $100 annual interest plus $1,000 at maturity. Bondf L has a maturity of 15 years, and Bond S a maturity of 1 year.

a. What will the value of each of these bonds when the going rate of interest is (1) 5 percent, (2) 8 percent, and (3) 12 percent? Assume that there is only one more interest payment to be made on Bond S.

b. Why does the longer-term (15 year) bond fluctuate more when interest rates change than does the shorter-term bond (1 year)?

Preferred stock evaluation

Fee Founders has preferred stock outstanding that pays a dividend of $5 at the end of each year. The preferred stock sells for $60 a share. What is the preferred stock's required rate of return?

- bond valuation -
**dadad**, Friday, October 5, 2007 at 3:38pm
adas

## Answer This Question

## Related Questions

- bond valuation - Bond valuation The Garraty Company has two bond issues ...
- Economics - Bonds - The Garraty company has two bond issues outstanding. Both ...
- Math - The Garraty company has two bond issues outstanding. Both bonds pa $100 ...
- finance - If there a two bonds issued and each pay $100.annual interest plus $...
- finance - (Bond valuation) Eagle Ventures has a bond issue outstanding with an ...
- Finace - Bond valuation Callaghan Motors’ bonds have 10 years remaining to ...
- FINANCE - Bond valuation Callaghan Motors’ bonds have 10 years remaining to ...
- Finance - Thompson Enterprises has $5,000,000 of bonds outstanding. Each bond ...
- Finance - (Bond valuation) A $1,000 face value bond has a remaining maturity of ...
- FINANCE - Bond valuation Nungesser Corporation’s outstanding bonds have a $1,000...

More Related Questions