24/7 — Client Support

+1(304) 900-6229

I need some help!  Part 1 Discussion Question In Chapters 5 , 6, and 7 of Ross, et al (2022) textbook you learned about the

I need some help! 

Part 1 Discussion Question

In Chapters 5 , 6, and 7 of Ross, et al (2022) textbook you learned about the concept of time value of money and how it is applied for bond valuation. View the following YouTube videos:

· Time Value of Money TVM Lesson/Tutorial Future/Present Value Formula Interest Annuities Perpetuities. (2014). [YouTube Video]. In YouTube.


· Chapter 7 : Interest Rates and Bond Valuation. (n.d.). Www.youtube.com. Retrieved July 19, 2022, from


Once viewed discuss the following with your peers:

Toyota Motor Credit Corporation (TMCC), a subsidiary of Toyota Motor Corporation, offered some securities for sale to the public on March 28, 2008. Under the terms of the deal, TMCC promised to repay the owner of each security $100,000 on March 28, 2038, but investors would receive nothing until then. Investors paid TMCC $24,099 for each of these securities; so they paid $24,099 on March 28, 2008 for the promise of a $100,000 payment 30 years later.

· Why would TMCC be willing to accept such a small amount today ($24,099) in exchange for a promise to repay about four times that amount ($100,000) in the future?

· A feature of this particular deal is that TMCC has the right to buy back the securities on the anniversary date at a price established when the securities were issued. What impact does this feature have on the desirability of this security as an investment?

Part 2 Bond Valuation Assignment

Based on the content covered in Week 5 and Chapters 5, 7 and 7 of the Ross, et al. (2022) text, students learned about time value of money and its application to bond valuation. Students should address the following:

Two bonds A and B have the same credit rating, the same par value, and the same coupon rate.

Bond A has 30 years to maturity and bond B has 5 years to maturity.

1. Explain which bond will trade at a higher price in the market and why?

2. What happens to the market price of each bond if the interest rates in the economy go up? Elaborate on your rationale.

3. Which bond would have a higher percentage price change if interest rates go up? Explain.

4. Substantiate your argument with numerical examples.

As a bond investor, if you expect a slowdown in the economy over the next 12 months, what would be your investment strategy?For this assignment, create a PowerPoint presentation and record yourself presenting your answers to the questions above in a 5-7 minute video. Use at least two credible sources to support ideas for your presentation.

Share This Post

Email
WhatsApp
Facebook
Twitter
LinkedIn
Pinterest
Reddit

Order a Similar Paper and get 15% Discount on your First Order

Related Questions

Submit the unknown identification report here. Rubric for the report:          (100 points) Objective (2 points) Procedure- your notes since the day you

Submit the unknown identification report here. Rubric for the report:          (100 points) Objective (2 points) Procedure- your notes since the day you received the sample (20 points) Results in a table (25 points) Discussion- Include information on (25 points) Conclusion (10 points) Significance of the bacterial species (10 points) Format, grammar, references (8 points) Sample report is attached.

DEFM310 1) Describe the four phases of the resource allocation process. You need to explain the details of each phase (who, what, when, where,

DEFM310 1) Describe the four phases of the resource allocation process. You need to explain the details of each phase (who, what, when, where, why).PPBEEnactmentApportionmentExecutionWrite a two-page paper, plus the title page and a reference page.Writing Instructions (Please do read this):•Written communication: Written communication is free of errors that detract

(concept analysis/shyness essay) Introduction: The introduction should give background (summary, author, purpose, etc) on the essay being analyzed. Suggest

(concept analysis/shyness essay) Introduction: The introduction should give background (summary, author, purpose, etc) on the essay being analyzed. Suggest improvements.Thesis: The thesis should state how the author is going to analyze the essay. It should be clear and specific in stating what the essay will be about. Suggest improvements.Topic sentences:

Discussion With the disruptions in technology, business, and social platforms, organizations in most industries feel compelled to implement new initiatives

Discussion With the disruptions in technology, business, and social platforms, organizations in most industries feel compelled to implement new initiatives. While these initiatives can help improve business processes or customer base, too much change can also create problems for many organizations leading to a dilution of effort and misallocation of