Consider a corporation who recently filed Chapter 11 bankruptcy (reorganization). Under the reorganization, the company has been allowed to reorganize their debt structure with a consolidated new deferral bond issue with more favorable terms. The new issuewill be a 40-year, 12% coupon rate bond with semiannual coupons. However, under the bond indenture, the company is relieved of making interest payments (deferred interest) for the first 10 years. For the remaining 30 years, the regular interest payments would resume. The reorganization calls for the deferred interest to be paid in 3 equal installments: onepayment occurring at the end of year 20, one at the end of year 25, and one at maturity. Calculate the value of a new $1,000 par value bond assuming a yield to maturity of 7%.

Jennifer purchased a house in a brand new development in the outskirts of town. when her house was built, the nearest fire department was nearly 20 miles away. as her neighborhood developed, the density of the community called for a new fire department 1.5 miles away. what effect will the new fire station have on her homeowners insurance premium? a. a new fire department will be more demanding on local taxes. her annual premium will go up. b. the location of a fire department has no bearing on the value of her house. her annual premium will stay the same. c. the new fire department will reduce the risk of financial loss in her home. her annual premium should decrease. d. with a fire department so close (less than 5 miles), financial risk on jennifer’s home practically disappears. she will not need to pay insurance anymore.

In a market economy, supply and demand are important because theya. (i) play a critical role in the allocation of the economy's scarce resources.b. (ii) determine how much of each good gets produced.c. (iii) can be used to predict the impact on the economy of various events and policies.d. all of (i), (ii), and (iii) are correct.

Which of the following is a benefit of a hat? it has a sports team logo on it. it makes the wearer look cool. it is red. it costs $12.