Examlex
Calculate the value of a $1,000 bond which has 10 years until maturity and pays quarterly interest at an annual coupon rate of 12 percent. The required return on similar-risk bonds is 20 percent.
Corporate Bond
A debt security issued by corporations to finance their operations, which promises to pay the holder a specified rate of interest and return the principal at maturity.
Tax Bracket
A range of incomes taxed at a certain rate within a tax system, where the tax rate typically increases as income rises.
Before-tax Yield
The earnings or return on an investment before the deduction of any taxes.
Return on Investment
A measure used to evaluate the efficiency or profitability of an investment, expressed as a ratio or percentage of the investment’s gain relative to its cost.
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