Question

Please answer them correctly. Here are short 3 problems. Please solve all 3 problems. I would really appreciate your effort. Thanks.

1. Linda Williams is looking to invest in a three-year bond that makes semi-annual coupon payments at a rate of 5.475 percent. If these bonds have a market price of $982.63, what yield to maturity can she expect to earn? (Round intermediate calculations to 5 decimal places, e.g. 1.25145 and final answer to 2 decimal places, e.g. 15.25%.)

Excel Template
(Note: This template includes the problem statement as it appears in your textbook. The problem assigned to you here may have different values. When using this template, copy the problem statement from this screen for easy reference to the values you’ve been given here, and be sure to update any values that may have been pre-entered in the template based on the textbook version of the problem.)

Yield to Maturity ____?

2. Blossom, Inc., has outstanding bonds that will mature in six years and pay an 8 percent coupon semiannually. If you paid $1,004.76 today and your required rate of return was 7.1 percent. (Round intermediate calculations to 5 decimal places, e.g. 1.25145 and final answer to 2 decimal places, e.g. 15.25.)

Excel Template
(Note: This template includes the problem statement as it appears in your textbook. The problem assigned to you here may have different values. When using this template, copy the problem statement from this screen for easy reference to the values you’ve been given here, and be sure to update any values that may have been pre-entered in the template based on the textbook version of the problem.)

How much should you have paid for the bond?

Worth of the bond_____?

3.  Carla Vista, Inc., has four-year bonds outstanding that pay a coupon rate of 7.30 percent and make coupon payments semiannually. If these bonds are currently selling at $911.89. What is the yield to maturity that an investor can expect to earn on these bonds? (Round answer to 1 decimal place, e.g. 15.2%.)

Yield to Maturity ______?

What is the effective annual yield? (Round answer to 1 decimal place, e.g. 15.2%.)

Effective Annual Yield _____?

Answer 1