#2) What is the price of a 9-year, 12-percent, annual coupon bond when the market rate...

#2) What is the price of a 9-year, 12-percent, annual coupon bond when the market rate is 9 percent? The face value is $100.

A) $108.00

B) $121.31

C) $117.99

D) $84.01

Expert Solution

Interest = $100 * 0.12 = $12

Current bond price = $12(PVIFA 9%,12) + $100(PVIF 9%,12)

Current bond price = ($12 * 7.16072527639) + ($100 * 0.35553472507)

Current bond price = $121.31

jeff jeffy answered 2 years ago

9. A bond matures in 12 years and pays a 6 percent annual coupon. The bond...

9. A bond matures in 12 years and pays a 6 percent annual coupon. The bond has a face value of $1,000 and currently sells for $890. What is the bond’s current yield and yield to maturity? 10. The face value for Karen’s Limited bonds is $100,000 and has a 2 percent annual coupon. The 2 percent annual coupon bonds matures in 2022, and it is now 2012. Interest on these bonds is paid annually on December 31 of each...

What is the price of a 5 year bond with a 8% annual coupon rate and...

What is the price of a 5 year bond with a 8% annual coupon rate and face value of $1,000? The prevailing market annual interest rate is 2%. Coupons are to be paid annually.

A semi-annual corporate bond has a coupon rate of 9 percent per year. The face value....

A semi-annual corporate bond has a coupon rate of 9 percent per year. The face value. is $1,000. The market interest rate (yield to maturity) for this bond today is 10.5 percent. This bond has 25 years. before maturity. What is the price of this bond today? (5 points). b. What is the current yield for this bond? (3 points) c. Why is the current yield different from the current market rate of this bond? (2 points)

A semi-annual corporate bond has a coupon rate of 9 percent per year. The face value...

A semi-annual corporate bond has a coupon rate of 9 percent per year. The face value is $1,000. The market interest rate (yield to maturity) for this bond today is 10.5 percent. This bond has 25 years before maturity. a. What is the price of this bond today? b. What is the current yield for this bond? c. Why is the current yield different from the current market rate of this bond? PLEASE SHOW HOW YOU WOULD GET ANSWERS ON...

What is the price of a 17- year bond paying an annual coupon rate of 8.7%,...

What is the price of a 17- year bond paying an annual coupon rate of 8.7%, but paying it semiannually, per face (par) value of 1,000 if the annual market rates for these bonds are 11.6%

what is the price of a 11-year bond paying an annual coupon rate of 9.2%, but...

what is the price of a 11-year bond paying an annual coupon rate of 9.2%, but paying it semiannually, per face (par) value of 1,000 if the annual market rates for these bonds are 10.3%. answer to nearest cent.

Consider a 3-year maturity annual 9% coupon paying bond with a YTM of 12%. a. What...

Consider a 3-year maturity annual 9% coupon paying bond with a YTM of 12%. a. What is the Duration of this bond? b. What will be the predicted price of this bond if the market yield increases by 100 basis points. [Remember, 100 basis points = 1% point]? You must use the duration (calculated in the part above) to get full points for this question.

Consider a bond paying a coupon rate of 9% per year semiannually when the market interest...

Consider a bond paying a coupon rate of 9% per year semiannually when the market interest rate is only 3.6% per half-year. The bond has six years until maturity. a. Find the bonds price today and six months from now after the next coupon is paid. b. What is the total rate of return on the bond? (% per six months)

5. Consider a bond paying a coupon rate of 9% per year semiannually when the market...

5. Consider a bond paying a coupon rate of 9% per year semiannually when the market interest rate is only 6%. The bond has five years until maturity. (15 points) a. Find the bond’s price today and six months from now after the next coupon is paid. b. What is the total rate of return on the bond?

Consider a 19-year bond with 13 percent annual coupon payments. The market rate (YTM) is 6.6...

Consider a 19-year bond with 13 percent annual coupon payments. The market rate (YTM) is 6.6 percent for this bond. The current yield of the bond is _______ percent. Answer it in percentage without the % sign, and round it to two decimal place, e.g., 5.69.

Question