In: Finance

# ExxonMobil ​12 year bonds pay 9 percent interest annually on a ​$1,000 par value. If the... ExxonMobil ​12 year bonds pay 9 percent interest annually on a ​$1,000 par value. If the bonds sell at $775 what is the​ bonds' expected rate of​ return? The​ bonds' expected rate of return is ? ## Solutions ##### Expert Solution The expected rate of return on the Bond is calculated using excel below The expected rate of return is therefore = 12.76% ## Related Solutions ##### The 12​-year, ​$1,000 par value bonds of Waco Industries pay 12 percent interest annually. The market...
The 12​-year, ​$1,000 par value bonds of Waco Industries pay 12 percent interest annually. The market price of the bond is ​$955​, and the​ market's required yield to maturity on a​ comparable-risk bond is 14 percent. a.  Compute the​ bond's yield to maturity. b.  Determine the value of the bond to you given the​ market's required yield to maturity on a​ comparable-risk bond. c.  Should you purchase the​ bond? Round to nearest two decimal places:
##### The 11​-year, ​$1,000 par value bonds of Waco Industries pay 9 percent interest annually. The market... The 11​-year, ​$1,000 par value bonds of Waco Industries pay 9 percent interest annually. The market price of the bond is ​$1,095​, and the​ market's required yield to maturity on a​ comparable-risk bond is 6 percent. a. Compute the​ bond's yield to maturity. b. Determine the value of the bond to you given the​ market's required yield to maturity on a​ comparable-risk bond. c. Should you purchase the​ bond? ##### ​Fingen's 13​-year, ​$1,000 par value bonds pay 9 percent interest annually. The market price of the...
​Fingen's 13​-year, ​$1,000 par value bonds pay 9 percent interest annually. The market price of the bonds is ​$850 and the​ market's required yield to maturity on a​ comparable-risk bond is 10 percent. a. Compute the​ bond's yield to maturity. b. Determine the value of the bond to​ you, given your required rate of return. c. Should you purchase the​ bond?
##### ​Fingen's 12​-year, ​$1,000 par value bonds pay 15 percent interest annually. The market price of the... ​Fingen's 12​-year, ​$1,000 par value bonds pay 15 percent interest annually. The market price of the bonds is ​$880 and the​ market's required yield to maturity on a​ comparable-risk bond is 16 percent. a. Compute the​ bond's yield to maturity. b. Determine the value of the bond to​ you, given your required rate of return. c. Should you purchase the​ bond? ##### The 12-year,$1,000 par value bonds of Smith Industries pay 7 percent interest annually. The market...
The 12-year, $1,000 par value bonds of Smith Industries pay 7 percent interest annually. The market price of the bond is$885, and the market’s required yield to maturity on a​ comparable-risk bond is 10 percent. What is your yield to maturity on the Smith bonds given the current market price of the​ bonds? Round to two decimal places. What should be the value of the Smith bonds given the​ market's required yield to maturity on a​comparable-risk bond? Round to...
##### Fingen's 15​-year, ​$1,000 par value bonds pay 12 percent interest annually. The market price of the... Fingen's 15​-year, ​$1,000 par value bonds pay 12 percent interest annually. The market price of the bonds is ​$1,100 and the​ market's required yield to maturity on a​ comparable-risk bond is 9 percent. a. Compute the​ bond's yield to maturity. b. Determine the value of the bond to​ you, given your required rate of return. c. Should you purchase the​ bond? ##### The 12​-year, ​$1,000 par value bonds of Waco Industries pay 12percent interest annually. The market...
The 12-year, $1,000 par value bonds of Waco Industries pay 12 percent interest annually. The market price of the bond is$1,135, and the market's required yield to maturity on a comparable-risk bond is 9 percent. Compute the bond's yield to maturity.1.  Determine the value of the bond to you given the market's required yield to maturity on a comparable-risk bond.
##### Fingen's 15​-year, ​$1,000 par value bonds pay 11 percent interest annually. The market price of the bonds... Fingen's 15​-year, ​$1,000  par value bonds pay 11 percent interest annually. The market price of the bonds is ​$920 and the​ market's required yield to maturity on a​ comparable-risk bond is 14 percent. a. Compute the​ bond's yield to maturity. b. Determine the value of the bond to​ you, given your required rate of return. c. Should you purchase the​ bond? ##### The 16​-year, ​$1,000 par value bonds of Waco Industries pay 11 percent interest annually. The market...
The 16​-year, ​$1,000 par value bonds of Waco Industries pay 11 percent interest annually. The market price of the bond is ​$945​, and the​ market's required yield to maturity on a​ comparable-risk bond is 10 percent. a.  Compute the​ bond's yield to maturity. b.  Determine the value of the bond to you given the​ market's required yield to maturity on a​ comparable-risk bond. c.  Should you purchase the​ bond?