Question
In: Finance
Bond 1 has a 10% annual coupon rate, $1000 maturity value, n = 5 years, YTM...
Bond 1 has a 10% annual coupon rate, $1000 maturity value, n = 5 years, YTM = 10% (pays a $100 annual coupon at the end of each year and $1,000 maturity payment at maturity at the end of year 5). Bond 2 is a zero coupon bond with a $1000 maturity value, and n = 5years; YTM= 10%. (has no coupon payments; only a $1,000 maturity payment paid at maturity at the end of year 5).
What is the price, duration, and modified duration of both bonds?
Solutions
jeff jeffy answered 1 week agoRelated Solutions
Bond 1 has a 4%annual coupon rate, $1000 maturity value, n = 5 years, YTM =...
Bond 1 has a 4%annual coupon rate, $1000 maturity value, n = 5
years, YTM = 4% (pays a $40 annual coupon at the end of each year
for each of the 5 years and $1,000 maturity payment at the end of
year 5).
Bond 2 is a zero couponbond with a $1000 maturity value, and n =
5 years; YTM= 4%. (pays no coupons; only a $1,000 maturity payment
at the end of year 5)
a. For the Zero...
a bond with a $1000 par value, 10 years to maturity, and a coupon rate of...
a bond with a $1000 par value, 10 years to maturity, and a
coupon rate of 6% paid annually is selling for $1,123.42. Its yield
to maturity is:
a. 3.00%
b. 4.44%
c. 12.34%
d. 10.29%
We have a bond such that, YTM = 6%, coupon rate = 5%, maturity = 10...
We have a bond such that, YTM = 6%, coupon rate = 5%, maturity =
10 years and it pays coupon semiannually. Now suppose YTM goes from
6% to 8%, how the bond price will change?
It will increase by $29.47
It will increase by $129.47
It will decrease by $129.47
It will decrease by $29.47
Consider a 10% annual coupon bond with three years of remaining maturity and a current YTM...
Consider a 10% annual coupon bond with three years of remaining
maturity and a current YTM of 12%. Calculate the duration and
convex it’s of this bond. If rates are expected to decline 2
percentage points use the convexity approximation to estimate the
percentage change be in price for the bond.
A bond has 3 years to maturity, a 10% annual coupon and a par value of...
A bond has 3 years to maturity, a 10% annual coupon and a par
value of $100. The bond pays a continuously compounded interest of
7%. Suppose the interest rate goes down to 6%. What would be the
percentage change in the price of the bond implied by the duration
plus convexity approximation?
A bond has 3 years to maturity, a 10% annual coupon and a par value of...
A bond has 3 years to maturity, a 10% annual coupon and a par
value of $100. The bond
pays a continuously compounded interest of 7%. Suppose the interest
rate goes down to 6%. What
would be the percentage change in the price of the bond implied by
the duration plus convexity
approximation?
Consider a 5- year bond with a semi-annual 10% coupon and a yield to maturity(ytm) of...
Consider a 5- year bond with a semi-annual 10% coupon and a
yield to maturity(ytm) of 9.00%. what is the duration of this bond
in years?
Consider the following bond: Face value = 1000; coupon rate = 8%; maturity = 5 years;...
Consider the following bond: Face value = 1000; coupon rate =
8%; maturity = 5 years; ytm = 7%
A) What is the value of the bond today and in 2 years?
b) what are the current yield and capital gains yield for this
bond this year and in two years?
c) Assuming interest rates remain the same over this bond's
lifetime, what is going to happen to the value of this bond as time
goes by?
A bond with 1000 par value, has 14 years left to maturity has a coupon rate...
A bond with 1000 par value, has 14 years left to maturity has a
coupon rate of 10% with semi-annual coupon payments. The current
yield to maturity is 15.5%. What is the current yield?
13.64%
11.15%
11.95%
14.51%
12.78%
1 Calculate the Yield to Maturity (YTM) of a 10-year annual coupon-ed bond with a coupon...
1 Calculate the Yield to Maturity (YTM) of a 10-year annual
coupon-ed bond with a coupon rate of 7%, a price of $1050, and a
face value of $1000.
2 a Calculate the Yield to Maturity (YTM) of a 10-year
semiannual coupon-ed bond with a coupon rate of 7%, a price of
$1050, and a face value of $1000.
b Calculate this bond's Current Yield (CY).
3 In previous Questions 4 and 5, with all the same maturity,
coupon...
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