Current yield and yield to maturity An annual coupon bond has a
$1,000 face value, coupon rate of 5%, will mature in 10 years, and
currently sells for $810.34.
a. What is the yield to maturity of the bond?
b. What is the current yield of the bond?
c. Why does the current yield differ from the yield to
maturity?
d. One year later, the market rates have increased to 8%. Assume
that you have just received a coupon payment...
An annual bond has a face value of $1,000, a coupon rate of
7.4%, a yield to maturity of 6.2% and has 12 years remaining to
maturity. What is the price of the bond?
You bought a 10-year zero-coupon bond with a face value of
$1,000 and a yield to maturity of 2.7% (EAR). You keep the bond for
5 years before selling it.
a:What was the price of the bond when you bought it?
b:What is your personal 5-year rate of return if the yield to
maturity is still 2.7% when you sell the bond? (i.e. what is your
rate of return given what you sold it for at the end of year...
An 11-year, $1,000 face value bond has an annual coupon rate of
8% and its yield to maturity is 7.5%. The bond can be called 3
years from now at a price of $1,060. What is the bond’s nominal
yield to call?
A bond has a face value of $1,000, an annual coupon rate of 5
percent, yield to maturity of 10 percent, and 10 years to maturity
Calculate the bond's duration.
You own a 2-year bond that has a face value of $1,000 with a
coupon rate of 3.5%. If you sell it for
$973, what is the current interest rate? Show your work and keep
your answer to 2 decimal places if
necessary
1.You own a 10-year, 3% semi-annual coupon bond with $100 face
value. If its yield to maturity is 5.3%, what percentage of its
value comes from coupon payments?
A 29-year U.S. Treasury bond with a face value of $1,000 pays a
coupon of 5.25% (2.625% of face value every six months). The
reported yield to maturity is 4.8% (a six-month discount rate of
4.8/2 = 2.4%). (Do not round intermediate calculations. Round your
answers to 2 decimal places.)
a. What is the present value of the bond?
b. If the yield to maturity changes to 1%, what will be the
present value?
c. If the yield to maturity...
A bond has a face value of $1,000, a coupon rate of 8%, and a
yield to maturity of 9.5%. If the bond matures in 8 years, what is
the price of the bond? (Assume coupons are paid annually.)