Question
In: Finance
A bond's market price is $800. It has a $1,000 par value, will mature in 6...
A bond's market price is $800. It has a $1,000 par value, will mature in 6 years, and has a coupon interest rate of 9 percent annual interest, but makes its interest payments semiannually. What is the bond's yield to maturity? What happens to the bond's yield to maturity if the bond matures in 12 years? What if it matures in 3 years?
Solutions
jeff jeffy answered 1 year agoRelated Solutions
) A bond's market price is $950. It has a $1,000 par value, will mature in...
) A bond's market price is $950. It has a $1,000 par value, will
mature in 14 years, and has a coupon interest rate of 8 percent
annual interest, but makes its interest payments semiannually. What
is the bond's yield to maturity? What happens to the bond's yield
to maturity if the bond matures in 28 years? What if it matures in
7 years? (Round to two decimal places.) The bond's yield to
maturity if it matures in 14 years...
A bond's market price is $1,175. It has a $1,000 par value,will mature in 12...
A bond's market price is $1,175. It has a $1,000 par value,
will mature in 12 years, and has a coupon interest rate of 11
percent annual interest, but makes its interest payments
semiannually. What is the bond's yield to maturity? What happens
to the bond's yield to maturity if the bond matures in 24 years?
What if it matures in 6 years?
A bond's market price is $1,125. It has a $1,000 par value, will mature in 8...
A bond's market price is $1,125. It has a $1,000 par value,
will mature in 8 years, and has a coupon interest rate of 8
percent annual interest, but makes its interest payments
semiannually. What is the bond's yield to maturity? What happens
to the bond's yield to maturity if the bond matures in 16 years?
What if it matures in 4 years?
a. The bond's yield to maturity if it matures in 8 years is
(?) % (Round to...
(Yield to maturity) A bond's market price is $900. It has a $1,000 par value, will...
(Yield to maturity) A bond's market price is
$900. It has a $1,000 par value, will mature in 8 years, and
has a coupon interest rate of 8 percent annual interest, but makes
its interest payments semiannually.
What is the bond's yield to maturity? % (Round to two
decimal places.)
What happens to the bond's yield to maturity if the bond
matures in 16 years? % (Round to two decimal places.)
What if it matures in 4 years?...
A(n)11.0%,25-year bond has a par value of $1,000 and a call price of$1,050.(The bond's first call...
A(n)11.0%,25-year bond has a par value of $1,000 and a call
price of$1,050.(The bond's first call date is in 5 years.)
Coupon payments are made semiannually (so use semiannual
compounding where appropriate).
a. Find the current yield, YTM, and YTC on this issue, given
that it is currently being priced in the market at$1,175. Which of
these 3 yields is the highest? Which is the lowest? Which yield
would you use to value this bond? Explain.
b. Repeat the 3...
A company issued $1,000 par value bond at 6% coupon rate. The bond will mature in...
A company issued $1,000 par value bond at 6% coupon rate. The
bond will mature in 6 years. Current market yield for this bond is
7%. If the coupon is paid semi-annually, what would be the value of
this bond?
Group of answer choices
$951.68
$682.29
$973.36
$952.33
A firm’s outstanding bonds have a $1,000 par value, are investment grade and mature in 6...
A firm’s outstanding bonds have a $1,000 par value, are
investment grade and mature in 6 years. These bonds pay interest
semiannually with a coupon of 8.0%. Assume that bond sells for
$955.00.
(a) What is the Yield-to-Maturity (YTM) bond?
(b) What is the bond’s Current Yield?
(c) What is the bond’s Capital Gains Yield?
(d) Now, suppose the bond is trading at $1,150 and that the bond
is callable in 2 years from now, at a call premium of...
A zero coupon bond has a par value of $1,000 and will mature in eight years....
A zero coupon bond has a par value of $1,000 and will mature in
eight years.
a Calculate the current price of this bond if the market yield
is: 1) 7.75 percent; ii) 5.25 percent.
b. In each case, calculate the percentage change in the price of
the bond if the market yield rises by 1 percent.
A bond with a $1,000 par value has a 4% annual coupon rate. Itwill mature...
A bond with a $1,000 par value has a 4% annual coupon rate. It
will mature in 4 years, and annual coupon payments are made at the
end of each year. Present annual yields on similar bonds are 3.5%.
What is the current price?
Midland Utilities has a bond issue outstanding that will mature to its $1,000 par value in...
Midland Utilities has a bond issue outstanding that will mature
to its $1,000 par value in 19 years. The bond has a coupon interest
rate of 11% and pays interest annually.
a. Find the value of the bond if the required return is (1)
11%, (2) 15%, and (3) 8%.
b. Use your finding in part a and the graph here, to discuss
the relationship between the coupon interest rate on a bond and the
required return and the market...
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