3. When originally issued, an investment in the bonds of Flushing Dough, Inc., promised to provide...

3. When originally issued, an investment in the bonds of Flushing Dough, Inc., promised to provide an annual coupon of 7.00%. The bonds have 4 years until maturity, a market price of $765, and are expected to pay all coupons on time. At maturity, however, the bonds are only forecasted to pay 88% of their par value. What is the likely yield to maturity on the bonds?

2. Last year, a company issued a 20-year annual coupon bond at par value with a yield to maturity of 9.00%. The current yield to maturity has increased to 9.30%. Investors anticipate another increase in yield to maturity over the next 12 months to 9.60%. If the investors forecast accurately, what will be the rate of return on an investment in this bond over the next year?

3. A Japan-based company, Sumo Gyms, Inc., issues a 35-year, semi-annual coupon bond, with a ¥300 million par value. The coupon rate is given as 6.90%, and the yield to maturity is 8.20.

a. What is the value of the semi-annual coupon on the bond? (Enter your answer in millions and round to two decimal places.)

b. What is the price of the bond?

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