What is the value of $1000 par value 8 3/8% Marriott Corporation bond for the for...

What is the value of $1000 par value 8 3/8% Marriott Corporation bond for the for each of the following required rates of return and assuming that the investor will hold the bond to maturity assume the coupon is paid semiannually (every six months) and the mature the bond matures in three years?
a. 6.50%
b. 11.30%

Solutions

Expert Solution

jeff jeffy answered 1 year ago

Next > < Previous

Related Solutions

You buy a bond with a par value of $1000 and a coupon rate of 8%...

You buy a bond with a par value of $1000 and a coupon rate of 8% with 18 coupons remaining. You hold the bond and receive 11 coupons. If the bond had a YTM of 8.2% when you bought it and 9.1% when you sold it, what was your annual holding period ROR?

An 8 year bond with a par value of $1000 has a semiannual coupon of 7.1%...

An 8 year bond with a par value of $1000 has a semiannual coupon of 7.1% and yield of 5%. What is the approximate price of this bond? Please provide excel formula. a) $864 b) $1,000 c)$1085 d) $1106 e)$1137

A bond of Visador corporation pays $90 in annual interest, with a $1000 par value. The...

A bond of Visador corporation pays $90 in annual interest, with a $1000 par value. The bonds mature in 18 years. The market's required yield to maturity on a comparable-risk bond is 7.5 percent. A. Calculate the value of the bond. B. How does the value change if the market's required yield to maturity on a comparable0risk bond (i) increases to 13 percent or (ii) decreases to 4 percent? C. Interpret your findings in parts a and b.

3. Exxon Mobil Cor. (rated AAA by S&P) issues an 8-year $1000 par value bond that...

3. Exxon Mobil Cor. (rated AAA by S&P) issues an 8-year $1000 par value bond that pays semi-annual coupons. The coupon rate is 4.5%. The bond is priced at $1116.59. Find the YTM in EAR. At the same time(as in question 3), Valero Corp. (rated BBB by S&P) issues a similar bond with the same maturity, par value, and coupon rate. However, the coupon frequency is quarterly. The BBB-AAA spread is 2.5%. Using the answer in Question 3 and the...

What is the price of a 1000 par value bond with a coupon rate of 7.5...

What is the price of a 1000 par value bond with a coupon rate of 7.5 annual payments that matures 11 years assuming the bonds ytm is 3.84

Given the following bond: Par Value = $1000 Time to Maturity = 8 years Coupon Rate...

Given the following bond: Par Value = $1000 Time to Maturity = 8 years Coupon Rate = 6.25% Coupons are paid annually. Calculate the Duration of this bond. Please note this is calculating the duration so you do not need the discount rate or the market price

A $1000 par value bonds pays an 8% APR coupon semiannually. If the bond has 10...

A $1000 par value bonds pays an 8% APR coupon semiannually. If the bond has 10 years to maturity and a YTM of 10%, what is its after-tax current yield for an investor paying 25% taxes? Answer: D. 6.9% Please explain how to find this by hand without using Excel.

what is the price of a $1000 par value bond with a coupon rate of 6.9%(annual...

what is the price of a $1000 par value bond with a coupon rate of 6.9%(annual payments) that matures in 25 years, assuming that the bond's YTM is 4.57% p.a.?

What is the price of a 15-year, $1000 par value bond with a 7% coupon that...

What is the price of a 15-year, $1000 par value bond with a 7% coupon that pays interest seminannually if we assume that its yield to maturity is 8%? What would be the price of the bond if its YTM were 9%? Compute the percentage change in price: (new price - initial price) / initial price. Repeat the exercise for a 10-year, $1000 bond with a 7% coupon paying interest semiannually using the same two yields. What do you notice...

Russell Container Corporation has a $1000 par value bond outstanding with 20 years to maturity. The...

Russell Container Corporation has a $1000 par value bond outstanding with 20 years to maturity. The bond carriers an annual interest payment of $126 and is currently selling for $980 per bond. Russell Corp. is in a 30 percent tax bracket. The firm wishes to know what the aftertax cost of a new bond issue is likely to be. The yield to maturity on the new issue will be the same as the yield to maturity on the old issue...

Subjects