Business: Assume CRT debtholders are promised payments in one year of $35 if the firm does well and $20 if the firm does poorly. There is a 50/50 chance of the firm doing well or poorly. If debtholders are willing to pay $25.50 today to purchase this debt, what is the promised return to those debtholders?

Assume CRT debtholders are promised payments in

Ответ:

tiaholmes31

05.02.2022

Business

The correct answer will be "7.84%".

Explanation:

The given values is:

Initial investment by bond holder

= $25.50

Now,

Expected payment after year will be:

= $35\times 0.50+20\times 0.50$

= 27.50 $

So,

Return will be:

= $\frac{27.50-25.50}{25.50}\times 100$

= $\frac{2}{25.50}\times 100$

= 7.84 %

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Ответ:

arnold2619

16.11.2020

Business

Either using its low-cost edge to underprice competitors and attract price-sensitive buyers in large enough numbers to increase total profits or refraining from price cutting and using the low-cost advantage to earn a bigger profit margin

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Assume CRT debtholders are promised payments in one year of $35 if the firm does well and $20 if the firm does poorly. There is a 50/50 chance of the firm doing well or poorly. If debtholders are willing to pay $25.50 today to purchase this debt, what is the promised return to those debtholders?

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