Question
In: Finance
Abner Corporation's bonds mature in 17 years and pay 14 percent interest annually. If you purchase...
Abner Corporation's bonds mature in 17 years and pay 14 percent interest annually. If you purchase the bonds for $1,225, what is your yield to maturity?
Solutions
Expert Solution
Solution
Calculation of yield to maturity(YTM)
Annual coupon=Face value*coupon rate
=$10000*14%=$140
YTM=[Annual coupon+(Face value-Purchase price)/Years to maturity]/(Face value+Purchase price)/2
=[$140+($1000-$1225)/17]/($1000+$1225)/2
=0.11395 or 11.395%
jeff jeffy answered 2 years agoRelated Solutions
Abner Corporation's bonds mature in 23 years and pay 9 percent interest annually. If you purchase...
Abner Corporation's bonds mature in 23 years and pay 9 percent
interest annually. If you purchase the bonds for $1,125, what is
your yield to maturity?
Abner Corporation's bonds mature in 25 years and pay 7 percent interest annually. If you purchase...
Abner Corporation's bonds mature in 25 years and pay 7 percent
interest annually. If you purchase the bonds for $725, what is
your yield to maturity? (round to 2 decimal points)
(Yield to maturity) Abner Corporation's bonds mature in 25 years and pay 14 percent interest annually....
(Yield to maturity) Abner Corporation's
bonds mature in 25 years and pay 14 percent interest annually. If
you purchase the bonds for $1,125, what is your yield to
maturity?
Your yield to maturity on the Abner bonds
is__% (Round to two
decimal places.)
(Bond valuation)The 8-year $1,000 par bonds
of Vail Inc. pay 8 percent interest. The market's required yield
to maturity on a comparable-risk bond is 11 percent. The current
market price for the bond is $920.
a. ...
1- Abner Corporation's bonds mature in 19 years and pay 8 percent interest annually. If you...
1- Abner Corporation's bonds mature in 19 years and pay 8
percent interest annually. If you purchase the bonds for $1,075,
what is your yield to maturity?
Your yield to maturity on the Abner bonds is _%. (Round to two
decimal places.)
2- The Saleemi Corporation's $1,000 bonds pay 9 percent
interest annually and have 11 years until maturity. You can
purchase the bond for $955.
a.What is the yield to maturity on this bond?
b.Should you purchase the bond...
The Saleemi Corporation's $1,000 bonds pay 11 percent interest annually and have 14 years until maturity....
The Saleemi Corporation's $1,000 bonds pay 11 percent
interest annually and have 14 years until maturity. You can
purchase the bond for $885.
a. What is the yield to maturity on this bond?
b. Should you purchase the bond if the yield to maturity on a
comparable-risk bond is 11 percent?
(Related to Checkpoint 9.2) (Yield to maturity) Abner Corporation's bonds mature in 24 years and pay...
(Related to Checkpoint 9.2) (Yield to maturity) Abner
Corporation's bonds mature in 24 years and pay 14 percent interest
annually. If you purchase the bonds for $1 comma 125, what is
your yield to maturity? Your yield to maturity on the Abner bonds
is nothing%. (Round to two decimal places.)
The ARA Corporation bonds have a coupon of 14%, pay interest semi-annually, and they will mature in 7 years.
a) The ARA Corporation bonds have a coupon of 14%, pay interest
semi-annually, and they will mature in 7 years. Your required rate
of return for such an investment is 10% annually.i) How much should you pay for a $1,000 ARA Corporation bond?ii) If you are given RM90,000, how many units of bond can you
purchase?iii) What is the yearly interest income for this bond if I purchase
it with RM90,000?iv) You plan to reinvest the coupon interest at 12%...
a).The ARA Corporation bonds have a coupon of 14%, pay interest semi-annually, and they will mature...
a).The ARA Corporation bonds have a coupon of 14%, pay interest
semi-annually, and they will mature in 7 years. Your required rate
of return for such an investment is 10% annually.
i) How much should you pay for a RM1,000 ARA Corporation bond?
ii) If you are given RM90,000, how many units of bond can you
purchase?
iii) What is the yearly interest income for this bond if I
purchase it with RM90,000?
iv) You plan to reinvest the coupon...
The Saleemi Corporation's $1,000 bonds pay 5 percent interest annually and have 9 years until maturity....
The Saleemi Corporation's $1,000 bonds pay 5 percent interest
annually and have 9 years until maturity. You can purchase the bond
for $955
a. What is the yield to maturity on this bond?
b. Should you purchase the bond if the yield to maturity on a
comparable-risk bond is 4 percent?
The Saleemi Corporation's $1000 bonds pay 9 percent interest annually and have 11 years until maturity....
The Saleemi Corporation's $1000 bonds pay 9 percent interest
annually and have 11 years until maturity. You can purchase the
bond for $925.
a. What is the yield to maturity on this bond? (round to 2
decimal points)
b. Should you purchase the bond if the yield to maturity on a
comparable-risk bond is 9 percent?
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- 1. Consider the following nuclides: &
- In general, teams can be described three ways. Name and define each.
- JAVASCRIPT: Please create an array of student names and another array of student grades. - Create...
- Topic - Construction: Structural, loads, tension 1.) Explain why pure tension members are the most efficient...
- Procter and Gamble (PG) paid an annual dividend of $ 1.62$1.62 in 2009. You expect PG...
- locate a recent case of online child pornography. Write a summary of the incident and describe...
- #Python 5. Write function called evaluate() that evaluates the following Python expressions or assignments as specified:...
ADVERTISEMENT