Question
1. A 10-year bond was issued last year with a coupon rate of 9 percent and a face value of 1000There are now 9 years
1. A 10-year bond was issued last year with a coupon rate of 9 percent and a face value of 1000There are now 9 years remaining for the life of the bond but the market interest rate of the bond is now 10 percent. What is the bond value?
Group of answer choices
a. $856.74
b. $950.59
c .$1000.00
d. $947.65
2. Your firms discount rate is 10 percent. You are considering the purchase of truck A or Truck B. Truck A costs $100, has a useful life of 3 years, no salvage value, and maintenance costs of $10 per year. Truck B costs $80, has a useful life of 2 years, no salvage value, and maintenance costs of $15 per year. Which truck should you select and why?
Group of answer choices
a. Truck A because the average cost of 43.3 is less than Truck B's total cost of 55
b. Truck A because the EUAC of -50.2 is less than the Truck B's EUAC of -61.1
c. Truck B because the total cost of 110 is less than Truck A's total cost of 130
d. Truck B because the NPV of -106 is less than Truck A's NPV of -125
Could you show the workings . thank you very much
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