Question
In: Finance
The yield to maturity of a $1,000 bond with a 7.1% coupon rate, semiannual coupons, and...
The yield to maturity of a $1,000 bond with a 7.1% coupon rate, semiannual coupons, and two years to maturity is 8.3% APR, compounded semiannually. What is its price?
Solutions
Expert Solution
Semiannual interest = $1,000 * 0.071 * 6/12 = $35.5
Current bond price = $35.5(PVIFA 4.15%,4) + $1,000(PVIF 4.15%,4)
Current bond price = ($35.5 * 3.61709977581) + ($1,000 * 0.84989035927)
Current bond price = $978.30
jeff jeffy answered 2 years agoRelated Solutions
The yield to maturity of a $1,000 bond with a 7.4% coupon rate, semiannual coupons, and...
The yield to maturity of a $1,000 bond with a 7.4% coupon rate,
semiannual coupons, and two years to maturity is 8.9% APR,
compounded semiannually. What is its price?
The yield to maturity of a $1,000 bond with a 6.7% coupon rate, semiannual coupons, and...
The yield to maturity of a
$1,000
bond with a
6.7%
coupon rate, semiannual coupons, and two years to maturity
is
8.2%
APR, compounded semiannually. What is its price?
The yield to maturity of a $1,000 bond with a 7.4 % coupon rate, semiannual coupons,...
The yield to maturity of a $1,000 bond with a 7.4 % coupon
rate, semiannual coupons, and two years to maturity is 8.8 %APR,
compounded semiannually. What is its price?
The yield to maturity of a $1000 bond with a 7% coupon rate, semiannual coupons, and...
The yield to maturity of a $1000 bond with a 7% coupon rate,
semiannual coupons, and two years to maturity is 7.6% APR,
compounded semiannually. What must its price be?
The YTM of 1,000 bond with a 10% coupon rate, semiannual coupons, and two years to...
The
YTM of 1,000 bond with a 10% coupon rate, semiannual coupons, and
two years to maturity is 6.5 APR, compounded semiannually.
b.Suppose the market price of this bond curretly is $980. Is
there an arbitrage opportunity ?
Answer : Yes / No
c. Is this bond undervalued or overvalued by the market
?
Answer : I don't know / Undervalued / Overvalued
d. Should you long or short this bond ?
Answer : Long / Short / Do nothing...
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 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?
What is the yield to maturity of a nine-year, $5,000 bond with a 5% coupon rate and semiannual coupons if this bond is currently trading for a price of $4,404?
What is the yield to maturity of a nine-year, $5,000 bond with a 5% coupon rate and semiannual coupons if this bond is currently
trading for a price of $4,404?A.8.15%B.3.4%C.6.79%D.9.51%
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?
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Facebook (FB) currently trades at $210.00. You purchase a 23 month European $11.00 strike call option...
- Make Animal an abstract class. Create a Kennel Class Create 2-3 Dog objects Create 2-3 Cat...
- GLO-BUS Are there any driving forces in the two market segments/product categories where your company competes?...
- 7 . You invest $100 in a T-bill with a rate of return of 0.05, and...
- Instructions: Research a case that involves any of the employment law concepts. Read the case. Feel...
- 110mg CaCl2 and 50mg CaSO4 added to 500mL water. solution pH is 8.0 ([H+]=10E-8M ; [OH-]=...
- At a Bloomburg City Council meeting, a plan to fund more swim safety programs was presented....
ADVERTISEMENT