Amazon has issued 25-year semi-annual coupon bondsthat have six years left until maturity. If the...

Amazon has issued 25-year semi-annual coupon bonds that have six years left until maturity. If the coupon rate is 6.70%, and the YTM is 6.80%, what is the number of coupons that are valued in the today’s price?

Expert Solution

We are given,

Assuming Par value of bond is $1000

Time to maturity = 6 years

No of periods = 6 * 2 ( semi-annual coupon) = 12

Semi annual coupon = 6.70%/2 * 1000 = $33.5

ytm = 6.80%

We can calculate Present value in excel,

Future Value	1000
pmt	33.5
interest	6.80%
No of period	12
Present Value	995.14	(=PV(6.80%/2,12,-33.5,-1000,0))

The present value of bond is $995.14.

The number of coupons that are valued in the today’s price are the no of coupon that are left to be paid for i.e. 12.

Discounting the Future coupon payments and principal value, we obtain the Present value of bond.

jeff jeffy answered 2 years ago

Amazon has issued 25-year semi-annual coupon bonds thathave six years left until maturity. If the...

Amazon has issued 25-year semi-annual coupon bonds that have six years left until maturity. If the coupon rate is 6.70%, and the YTM is 6.80%, what is the number of coupons that are valued in the today’s price? A50 b25 c12 d6 e 2Warren Buffett expects a 6% return on Goldman Sack’s preferred stock, and the dividend is expected to be $1.30 every six months, what is the fair price for this preferred stock per share? A 43.333 b 21.667...

1. A semi-annual coupon bond with 25 years until maturity has a coupon rate of 7.2...

1. A semi-annual coupon bond with 25 years until maturity has a coupon rate of 7.2 percent and a yield to maturity of 6 percent. If the par value is $1000, what is the price of the bond?

Kaven Corp bonds have a 9% semi-annual coupon, 10 years left till maturity, and they are...

Kaven Corp bonds have a 9% semi-annual coupon, 10 years left till maturity, and they are currently selling for $1179. What is the yield to maturity of Kaven's bonds?

A company currently have semi-annual $1,000 face value bonds outstanding with 20 years left until maturity...

A company currently have semi-annual $1,000 face value bonds outstanding with 20 years left until maturity that pay 6-percent annual coupons. The bonds are currently trading at a discount of 96 percent of the par value, and there are 1,500 bonds outstanding. The company also have 50,000 preferred shares outstanding providing a $2 annual dividend with a $25 per share par value and currently trading at $23.50 per share. The company has a beta of 1.18, and present market conditions...

A 20-year fixed coupon bond has 12 years left until maturity. It has a 7% coupon rate...

A 20-year fixed coupon bond has 12 years left until maturity. It has a 7% coupon rate paid SEMI-ANNUALLY. If the price of the bond is $850, what is the annual yield? a. 9.08% b. 4.56% c. 9.11% d.4.54% e. 8.60%

You purchased a $1,000 bond with a 4.6% semi-annual coupon and 15 years to maturity six...

You purchased a $1,000 bond with a 4.6% semi-annual coupon and 15 years to maturity six years ago at a price of $865. If the yield has remained constant, what should be the price of the bond today? A. $959.46 B. $601.31 C. $905.32 D. $900.24 Three years ago you purchased a $1,000 par 12-year bond with a 3.5% semi-annual coupon at a price of $875. If the current price is $965, what is the yield to maturity of the...

Eades Corp. has 9% annual coupon bonds that are callable and have 18 years left until...

Eades Corp. has 9% annual coupon bonds that are callable and have 18 years left until maturity. The bonds have a par value of $1,000, and their current market price is $1,130.35. However, Eades Corp. may call the bonds in eight years at a call price of $1,060. a. What are the YTM and the yield to call (YTC) on Eades Corp.’s bonds? b. If interest rates are expected to remain constant, what is the best estimate of the remaining...

Badger Corp. has 9% annual coupon bonds that are callable and have 18 years left until...

Badger Corp. has 9% annual coupon bonds that are callable and have 18 years left until maturity. The bonds have a par value of $1,000, and their current market price is $1,100.35. However, Badger Corp. may call the bonds in eight years at a call price of $1,060. What are the YTM and the yield to call (YTC) on Badger Corp.’s bonds? If interest rates are expected to remain constant, what is the best estimate of the remaining life left...

Blanche Inc. has 9% annual coupon bonds that are callable and have 18 years left until...

Blanche Inc. has 9% annual coupon bonds that are callable and have 18 years left until maturity. The bonds have a par value of $1000 and their current market price is $1040.35. However, Blanche Inc. may call the bonds in eight years at a call price of $1060. What are the YTM and the yield to call (YTC) on Blanche Inc.'s bonds? Value YTM a. 9.89% b. 8.55% c. 7.83% d. 7.93% YTC a. 7.93% b. 7.36% c. 8.82% ...

For Bonds Years until maturity 25 Coupon rate (assume annual coupon payments) 8.40% Face 1,000...

For Bonds Years until maturity 25 Coupon rate (assume annual coupon payments) 8.40% Face 1,000 Current Price 880 Number of bonds outstanding 18,000 For Preferred Stock Price of Preferred Stock 34.85 Dividend on Preferred 4.18 Number or preferred shares outstanding 25,600 For Common Stock Common price 26.34 Estimated growth rate in dividends 3.00% Estimated dividend in one year 3.00 (Assume annual dividends) Number of common shares outstanding 729,000 Tax rate 35.40% What...

Question