Question

In: Finance

Suppose a 10​-year, $ 1,000 bond with a 10 % coupon rate and semiannual coupons is...

Suppose a 10​-year, $ 1,000 bond with a 10 % coupon rate and semiannual coupons is trading for a price of $906.44

.a. What is the​ bond's yield to maturity​ (expressed as an APR with semiannual​ compounding)?

b. If the​ bond's yield to maturity changes to8 %​APR, what will the​ bond's price​ be?

Solutions

Expert Solution

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

As nothing was mentioned excel is used.


Related Solutions

Suppose a 10-year, $1,000 bond with a 10% coupon rate and semiannual coupons is trading for...
Suppose a 10-year, $1,000 bond with a 10% coupon rate and semiannual coupons is trading for a price of $ 913.23. a. What is the bond's yield to maturity (expressed as an APR with semiannual compounding)? b. If the bond's yield to maturity changes to 9% APR, what will the bond's price be?
Suppose a​ ten-year, $ 1,000 bond with an 8.1 % coupon rate and semiannual coupons is...
Suppose a​ ten-year, $ 1,000 bond with an 8.1 % coupon rate and semiannual coupons is trading for $ 1, 035.42. a. What is the​ bond's yield to maturity​ (expressed as an APR with semiannual​ compounding)? (round to two decimal places) b. If the​ bond's yield to maturity changes to 9.6 % ​APR, what will be the​ bond's price? (round to the nearest cent)
Suppose a​ ten-year, $ 1,000 bond with an 8.7 % coupon rate and semiannual coupons is...
Suppose a​ ten-year, $ 1,000 bond with an 8.7 % coupon rate and semiannual coupons is trading for $ 1,035.04. a. What is the​ bond's yield to maturity​ (expressed as an APR with semiannual​ compounding)? b. If the​ bond's yield to maturity changes to 9.1 % ​APR, what will be the​ bond's price?
Suppose a​ ten-year, $1,000 bond with an 8.3% coupon rate and semiannual coupons is trading for...
Suppose a​ ten-year, $1,000 bond with an 8.3% coupon rate and semiannual coupons is trading for $1,034.16. a. What is the​ bond's yield to maturity​ (expressed as an APR with semiannual​ compounding)? b. If the​ bond's yield to maturity changes to 9.8% ​APR, what will be the​ bond's price?
Suppose a​ ten-year, $1,000 bond with an 8.5% coupon rate and semiannual coupons is trading for...
Suppose a​ ten-year, $1,000 bond with an 8.5% coupon rate and semiannual coupons is trading for $1,034.79. a. What is the​ bond's yield to maturity​ (expressed as an APR with semiannual​ compounding)? b. If the​ bond's yield to maturity changes to 9.4% ​APR, what will be the​ bond's price?
Suppose a​ ten-year, $1,000 bond with an 8.7% coupon rate and semiannual coupons is trading for...
Suppose a​ ten-year, $1,000 bond with an 8.7% coupon rate and semiannual coupons is trading for $1,035.67. a. What is the​ bond's yield to maturity​ (expressed as an APR with semiannual​ compounding)? b. If the​ bond's yield to maturity changes to 9.7% ​APR, what will be the​ bond's price? nothing​%. ​ (Round to two decimal​ places.)
Suppose a​ ten-year, $1,000 bond with an 8.8% coupon rate and semiannual coupons is trading for...
Suppose a​ ten-year, $1,000 bond with an 8.8% coupon rate and semiannual coupons is trading for $1,035.09. a. What is the​ bond's yield to maturity​ (expressed as an APR with semiannual​ compounding)? b. If the​ bond's yield to maturity changes to 9.7% ​APR, what will be the​ bond's price? a. What is the​ bond's yield to maturity​ (expressed as an APR with semiannual​ compounding)?
Suppose a​ seven-year, $1,000 bond with a 7.5% coupon rate and semiannual coupons is trading with...
Suppose a​ seven-year, $1,000 bond with a 7.5% coupon rate and semiannual coupons is trading with a yield to maturity of 6.39%. a. Is this bond currently trading at a​ discount, at​ par, or at a​ premium? Explain. b. If the yield to maturity of the bond rises to 7.34% ​(APR with semiannual​ compounding), what price will the bond trade​ for? a. Is this bond currently trading at a​ discount, at​ par, or at a​ premium? Explain.  ​(Select the best...
Suppose a​ seven-year, $1,000 bond with an 8.3% coupon rate and semiannual coupons is trading with...
Suppose a​ seven-year, $1,000 bond with an 8.3% coupon rate and semiannual coupons is trading with a yield to maturity of 6.37%. a. Is this bond currently trading at a​ discount, at​ par, or at a​ premium? Explain. b. If the yield to maturity of the bond rises to 7.42% ​(APR with semiannual​ compounding), what price will the bond trade​ for?
Suppose a​ seven-year, $1,000 bond with a 8.03 % coupon rate and semiannual coupons is trading...
Suppose a​ seven-year, $1,000 bond with a 8.03 % coupon rate and semiannual coupons is trading with a yield to maturity of 6.57%. a. Is this bond currently trading at a​ discount, at​ par, or at a​ premuim? Explain. b. If the yield to maturity of the bond rises to 7.26 % (APR with semiannual​ compounding), at what price will the bond​ trade?
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT