is a coupon bond with no maturity. The price of a perpetuity (in dollars) t it...

Question

Question

business economics

Answer 1

Answer #1

1. A consol is a coupon bond with no maturity.

2. Ans: $818.18

Explanation:

P = A / i

90 = 90 / 0.11 = $818.18

3. Ans: 12.5%

Explanation:

i = (A / P) * 100

= (50 / 400) * 100

= 12.5%

Answer 2

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