Answer:
Refer to the explanation
Explanation:
Please look at the images below for a detailed step-by-step explanation regarding the question above.
Kalyan Singhal Corp. makes three products, and it has three machines available as resources as given in the following LP problem
:Maximize contribution = 6X1 + 8X2 + 4X3Subject to:1X1 + 7X2 + 4X3 <= 72(hours on machine 1)2X1 + 1X2 + 7X3 <= 76 (hours on machine 2)8X1 + 4X2 + 1X3 <= 72 (hours on machine 3)X1, X2, X3 >=0(a) Determine the optimal solution using LP software. the optimal achieved isX1=X2-X3=contribution =(b) Is there unused time available on any of the machines with the optimal solution?(c) What would it be worth to the firm to make an additional hour of time available on the third machine?(d) How much would the firm’s profit increase if an extra 15 hours of time were made available on the second machine at no extra cost?
1 answer:
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Answer:
a) YTM = 9.8%
b) realized compound yield = 9.9%
Explanation:
a) PMT is 80
par value FV = 1000
coupon rate = 8%
current price PV = 953.1
years to maturity n = 3
Yield to maturity (YTM) is calculated as =
= 9.8%
b) r2 = 10% = 100%+10% = 1.1
r3 = 12% = 100%+12% = 1.12
To find the realized compound yield, we first need the future value (FV) of the principal and reinvested coupons.
FV = ($80 * 1.10 * 1.12) + ($80 * 1.12) + $1080 = $1268.16
Let a be the rate at which the future value equals $1268.16.
953.1(1+y)³ = $1268.16
(1+y)³ = 1.33
1+y = 1.099
y = 0.099 = 9.9%