Question
In: Finance
Bonnie purchased a 10 year bond on 1/1/2000. The bond was purchased to yield 4% per...
Bonnie purchased a 10 year bond on 1/1/2000. The bond was purchased to yield 4% per year convertible quarterly. The coupons are paid at 5% convertible quarterly. The bond is redeemable at par at the amount of 10,000. Bonnie received a coupon on 7/1/2005. What is the amortization of premium of the coupon she just received? 20.28 20.90 19.65 20.32 20.69
Solutions
jeff jeffy answered 1 year agoRelated Solutions
you have purchased a 4-year upon bond paying a coupon rate of 10% per year semiannually...
you have purchased a 4-year upon bond paying a coupon rate of
10% per year semiannually with a yield to maturity of 8% and a Face
value of $1000.
What would your rate of return if you sell the bond 30 days
after receiving the first coupon? The reinvestment rate is 3% for
these 30 days (not annualized). Assume that bonds bid and ask
prices on the market at the time are Bid: $1013.96 and ask:
$1019.03. the coupon periods...
You have just purchased a 10-year zero-coupon bond with a yield to maturity of 10% and...
You have just purchased a 10-year zero-coupon bond with a yield
to maturity of 10% and a par value of $1,000. What would the rate
of return on your investment at the end of the year be if you sold
the bond? Assume the yield to maturity on the bond is 11% at the
time you sell.
A) 10.00%
B) 20.42%
C) 13.85%
D) 1.4%
2. Consider a 5-year bond with a 7% coupon and a yield to
maturity of...
The yield to maturity of a 10-year 4% annual coupon bond is 4%. a.Suppose that you...
The yield to maturity of a 10-year 4% annual coupon bond is
4%.
a.Suppose that you buy the bond today and hold it for 10
years.Assume that the interest rates go up to 5% (100 basis points
increase) after the bond is purchased and before the first coupon
is received. What is your realized rate of return?
b.Suppose that you buy the bond today and hold it for
6years.Assume that the interest rates go up to 5% (100 basis points...
The yield to maturity of a 10-year 4% annual coupon bond is 4%. a.Suppose that you...
The yield to maturity of a 10-year 4% annual coupon bond is
4%.
a.Suppose that you buy the bond today and hold it for 10
years.Assume that the interest rates go up to 5% (100 basis points
increase) after the bond is purchased and before the first coupon
is received. What is yourrealized rate of return?
b.Suppose that you buy the bond today and hold it for
6years.Assume that the interest rates go up to 5% (100 basis points
increase)...
4. a) Compute the modified duration of a 10% coupon, 4-year corporate bond with a yield...
4. a) Compute the modified duration of a 10% coupon, 4-year
corporate bond with a yield to maturity of 8%. b) Using the
modified duration, If the market yield drops by 25 basis points,
there will be a __________% (increase/decrease) in the bond's
price.
A 10%, 10-year bond is sold to yield 8%. One year passes, and the yield remains...
A 10%, 10-year bond is sold to yield 8%. One year passes, and
the yield remains unchanged at 8%. Holding all other factors
constant, the bond's price during this period will have:
a. Increased
b. Decreased
c. Remained constant
Peter purchased a 10-year corporate bond with an 8% annual coupon and the yield-to-maturity (YTM) was...
Peter purchased a 10-year corporate bond with an 8% annual
coupon and the yield-to-maturity (YTM) was 10% three years ago.
Today, Peter just received the third coupon payment. Due to a
financial emergency, Peter is forced to sell the bond today at a
price of $1,100.
(a) Determine the annual rate of return (APR) Peter can earn if
he held the bond to maturity.
(b) At what price should Peter buy the bond? [Round your final
answer to 2 d.p.]...
A bond trader purchased each of the following bonds at a yield to maturity of 10%....
A bond trader purchased each of the following bonds at a yield
to maturity of 10%. Immediately after she purchased the bonds,
interest rates fell to 7%. The data has been collected in the
Microsoft Excel Online file below. Open the spreadsheet and perform
the required analysis to answer the questions below.
What is the percentage change in the price of each bond after
the decline in interest rates? Assume annual coupons and annual
compounding. Fill in the following table....
A 4-year 12% coupon bond has a yield of 10%. a) What are its Macaulay Duration,...
A 4-year 12% coupon bond has a yield of 10%.
a) What are its Macaulay Duration, Modified duration, and
convexity
b) What is the actual price change, Modified Duration predicted
price change and Modified Duration + convexity predicted change in
price for an increase of 50 basis point in the yield.
Assume a flat term structure before and after the increase and
annual coupons.
Find the duration of a 10-year, 8% bond that is trading at a yield of 10%...
Find the duration of a 10-year, 8% bond that is trading at a
yield of 10% and pays coupons every 6 months.
Please round your numerical answer to two decimal places.
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