A bond is trading today that will mature five years from now. It
pays interest annually....
A bond is trading today that will mature five years from now. It
pays interest annually. Its coupon rate is 5% and the par is
$1,000. The yield is currently 6%. The value of the bond today is
$
Solutions
Expert Solution
I HAVE EXPLAINED USING FORMULA AND ALSO EXCEL
FUNCTION.
jack Wong purchased a five-year bond today at $991.62. The bond
pays 6.5 percent semi-annually. What will be the yield to
maturity?
a.
5.2%
b.
6.7%
c.
5.7%
d.
6.1%
e.
5.0%
A coupon bond that pays interest of $70 annually has a par value of $1000, matures in 6 years and is selling today at $50.50 discount from par value. The current yield on this bond is ______?
A 5.4% coupon bearing bond pays interest semi-annually and has a
maturity of 12 years. If the current price of the bond is
$1,076.63, what is the yield to maturity of this bond? (Answer to
the nearest hundredth of a percent, e.g. 12.34%)
Consider a bond that pays annual coupons and matures in 5.5
years from today when the last coupon is paid. The principal is
$100 and the annual coupon is $10 and the yield to maturity
(compounded annually with a 30/360 daycount) is 10%. Find the flat
price of the bond today.
A 1,000$ par value bond with five years left to maturity pays an
interest payment semiannually with a 6 percent coupon rate and is
priced to have a 5 percent yield to maturity. If interest rates
surprisingly increase by 0.5 percent, by how much would the bond's
price change ? (Do not round intermediate calculations. Round your
answer to 2 decimal places. (e.g., 32.16))
Bonds price _______ by __________ ? .
A five-year bond with a yield of 11% (compounded annually) pays
an 8%
coupon at the end of each year.
(a) What is the bond’s price?
(b) What is the bond’s duration?
(c) Use the duration to calculate the effect on the bond’s price
of a 0.2% de-
crease in its yield.
(d) Recalculate the bond’s price on the basis of a 10.8% per
annum yield and
verify that the result is in agreement with your answer to
(c).
Face...
Consider a three-year bond trading at $110.83 that pays a 10%
coupon semi-annually and has a yield to maturity (YTM) of 6%.
Calculate the duration of this bond.
b)What will be the final price if the YTM increases from 6% to
7%?
Consider a three-year bond trading at $110.83 that pays a 10%
coupon semi-annually and has a yield to maturity (YTM) of 6%.
a) Calculate the duration of this bond.
b) What will be the final price if the YTM increases
from 6% to 7%?
Consider a $1,000 par value bond with a 7% annual coupon. The
bond pays interest annually. There are 20 years remaining until
maturity. You have expectations that in 5 years the YTM on a
15-year bond with similar risk will be 7.5%. You plan to purchase
the bond now and hold it for 5 years. Your required return on this
bond is 10%. How much would you be willing to pay for this bond
today? Select one:
a. $820
b....