Valuing Bonds Essay Example | Topics and Well Written Essays - 250 words

Valuing Bonds - Essay Example The call provision feature allows bond issuers to pay off the remaining debt early before the maturity date. The role of the borrower is to make a lump sum payment derived from a formula based on the net present value (NPV) of future coupon payments that  will not be paid because of the call. The call provision right is usually exercised at times of low interest rates and it allows the bond holder to retire what is currently a high interest debt and reissue it at a lower interest rate. Call provisions limit a bonds potential price appreciation because when interest rates fall, the price of a callable bond will not go any higher than its call price. Thus, the true yield of a callable bond at any given price is usually lower than its yield to maturity. A discount bond is a bond issued at a price lower than its par value is a bond currently trading at less than its par value in the secondary market. An example is a $4,000,000, 9%, 5-year bond with par value of $1000 issued at $970. A premium bond is a bond issued at a price higher than its par value is a bond currently trading at more than its par value in the secondary market. An example is a $4,000,000, 9%, 5-year bond with par value of $100 issued at $105. For a 5% bond, interest is paid is calculated at the interest rate on the par value of bond and is paid periodically (annually or semi-annually) while for a zero coupon bond, no periodic interest payments are made. When the bond reaches maturity, its investor receives its par (or face) value. "Calculate the price of a $1,000 (FV) zero coupon bond that matures in 20 years if the market interest rate is 6.5 percent." (Cornett, Adair, and Nofsinger, 2012, p. 147). Assume semi-annual compounding. 4. "Compute the price of a $1,000 (FV) 4.5 percent coupon bond with 15 years left to maturity and a market interest rate of 6.8 percent." (Cornett, Adair, and Nofsinger, 2012, p. 148). Assume interest payments are paid semi-annually,

The Limits of Freedom Term Paper Example | Topics and Well Written Essays - 1250 words

The Limits of Freedom - Term Paper Example From the independence of America to the beginning of the New World, White males had superiority and complete freedom as compared to the women, African Americans and American Indian. The religious groups did not enjoy freedom as well. Freedom of Women: In the colonial era, the treatment and behaviour with women varied with colonies and tribes, with the variation in the ethnicity of the tribe. The Puritan settlers from England did not allow the women to work with the men in the fields as they were very religious and believed that the women should look after their men and bring up children who feared God. The German women however could be seen working in the fields along with the men and in the stables as well. The English women did not own their own clothes and had no right to write their wills regarding the things they possessed. On the contrary, German and Dutch women had their own clothes and also had the freedom to make their wills. ... i Single women could vote up to 1807 according to the New Jersey state constitutions but married women could not. ii Freedom of African Americans The African Americans were brought into the country as slaves. They were treated very poorly and had no rights. While being transported on slave ships, these slaves were forced to leave their families and chained below the deck of the ship. Their living conditions were unhygienic and they suffered from severe malnutrition which resulted in an increase in the prevalence of diseases at an alarming rate. They were punished harshly. They first arrived in America in 1619 as servants sold to Englishmen. Killing a slave however was still a crime and some whites were even hanged as a punishment. The owners treated them no better than livestock. iii The African American children were not allowed to study in schools so they made schools for themselves within the community where the children could get educated. White males, either naive or immigrant w ere preferred to be hired by companies rather than the African Americans. During the Civil War, President Lincoln promised the slaves in the Southern states freedom from their slavery if the Union won the war.iv By February 1865, about 200,000 slaves were freed. The Civil Rights Act of 1866 the African Americans were declared as Americans and two years later the African Americans were granted citizenship of America. Freedom of American Indians American Indians are the indigenous natives of the continental United States, Hawaii and Alaska. Difference in culture between the Native Americans and immigrants from Europe and Africa, the constantly changing alliance of different people has been a source of quarrel between the New World and Old World societies. They were