Question
In: Finance
Assume you have a bond with a semi-annual interest payment of $50, a par value of...
Assume you have a bond with a semi-annual interest payment of $50, a par value of $1,000, and a current market price of $770. What is the current yield of the bond?
Solutions
Expert Solution
Annual interest payment = 50 * 2 = 100
Current yield = (Annual coupon / price) * 100
Current yield = (100 / 770) * 100
Current yield = 12.99%
jeff jeffy answered 2 years agoRelated Solutions
A 20 yr maturity bond with par value of $1000 makes semi-annual coupon payment at a...
A 20 yr maturity bond with par value of $1000 makes semi-annual
coupon payment at a coupon rate of 8%. What is the effective annual
yield if the bond price is $950?
The answer is 8.7%
Please show work, USING THE BA CALCULATOR. Thank you.
A bond with a face value of $1000 will pay it's next semi-annual $50 coupon payment...
A bond with a face value of $1000 will pay it's next semi-annual
$50 coupon payment in exactly 6-months. What is the price of the
bond if it matures in 6 years and the required yield-to-maturity is
14% APR compounded semi-annually?
A bond matures in 8 years, Par value = $1,000, and coupon annual interest payment =...
A bond matures in 8 years, Par value =
$1,000, and coupon annual interest payment = $65. Yield to maturity
of this bond is 8.2% (yield, or annual return). What is the bond's
price?
a. $903.04
b. $925.26
c. $948.67
d. $972.84
A 15 year bond currently sells at par. It offers semi-annual payments and the payment is...
A 15 year bond currently sells at par. It offers semi-annual
payments and the payment is $36. What is the yield to maturity of
this bond? Please answer Using Excel!!!
Assuming a semi-annual interest payment, determine both the bond-equivalent and annual effective annual yield
Assuming a semi-annual interest payment, determine both the
bond-equivalent and annual effective annual yield (to two
significant digits) of a bond whose current price is $972, a coupon
rate of 7%, a face value of $1000 and with a maturity of 15
years.
6. Consider a bond with semi-annual coupon payments of $50, a principal payment of $1,000 in...
6. Consider a bond with semi-annual coupon payments of $50, a
principal payment of $1,000 in 5 years, and a price of $1,000.
Assume that the yield curve is a flat 10%. What is the duration of
the bond?
1. Assume a bond that has a $5000 par value, pays annual coupon interest of 10%,...
1. Assume a bond that has a $5000 par value, pays annual coupon
interest of 10%, matures in three years, and has a yield to
maturity of 12%? What is the duration (i.e., Macaulay’s Duration)
of this bond? (Round your answer to 5 decimal places).
2. If the yield to maturity on this bond increases by 125 basis
points, what will be the percent change in the price of the bond
(according to the answer(s) you calculated above)? Record your...
You own a bond that pays $100 in annual interest, with a$1,000 par value. It...
You own a bond that pays $100 in annual interest, with a
$1,000 par value. It matures in 10 years. Your required rate of
return is 11 percent.a. Calculate the value of the bond.b. How does the value change if your required rate of return
(1) increases to 16 percent or (2) decreases to 7 percent?c. Explain the implications of your answers in part b as they
relate to interest rate risk, premium bonds, and discount
bonds.d. Assume that the...
You own a bond that pays $100 in annual interest, with a $1000 par value. It...
You own a bond that pays $100 in annual interest, with a
$1000 par value. It matures in 15 years. The market's required
yield to maturity on a comparable-risk bond is 12 percent.
a. Calculate the value of the bond. b. How does the value change
if the yield to maturity on a comparable-risk bond (i) increases
to 15 percent or (ii) decreases to 8 percent? c. Explain the
implications of your answers in part b as they relate to...
You own a bond that pays $100 in annual interest, with a $1,000 par value. It...
You own a bond that pays $100 in annual interest, with a $1,000
par value. It matures in 15 years. The market's required yield to
maturity on a comparable-risk bond is 12 percent.
a.??Calculate the value of the bond.
b.??How does the value change if the yield to maturity on a?
comparable-risk bond? (i) increases to
15
percent or? (ii) decreases to
8
?percent?
c.??Explain the implications of your answers in part b as they
relate to? interest-rate risk, premium?...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Why do we compare means instead of individual scores? for comparing average SAT test scores across...
- NPV Your division is considering two projects with the following cash flows (in millions): 0...
- The equivalent synchronous impedance of a 25kVA, 400V three-phase Y-connected synchronous generator is 0.05 + j1.6...
- You have $100,000 to invest in either Stock D, Stock F, or a risk-free asset. You...
- In two or three sentences, explain how you have seen the concept of grit work in...
- You have invested 30 percent of your portfolio in Jacob, Inc., 40 percent is Bella Co.,...
- Parallel Arrays This question is in MindTap Cengage Summary In this lab, you use what you...
ADVERTISEMENT