Homework #4F (Bond Yield to Call

.docx

School

University of Maryland, University College *

*We aren’t endorsed by this school

Course

330 7980

Subject

Finance

Date

Nov 24, 2024

Type

docx

Pages

2

Uploaded by Dogmom87

Report
Question 1 (1 point) Saved What is the yield to call of a 30-year to maturity bond that pays a coupon rate of 11.98 percent per year, has a $1,000 par value, and is currently priced at $918? The bond can be called back in 7 years at a call price $1,089. Assume annual coupon payments. Round the answer to two decimal places in percentage form. (Write the percentage sign in the "units" box) You should use Excel or financial calculator. Your Answer: ECR— Answer units Question 2 (1 point) Saved Bright Sun, Inc. sold an issue of 30-year $1,000 par value bonds to the public. The bonds had a 14.98 percent coupon rate and paid interest annually. It is now 7 years later. The current market rate of interest on the Bright Sun bonds is 10.96 percent. What is the current market price (intrinsic value) of the bonds? Round the answer to two decimal places. Your Answer: 1333.30 Answer
Question 3 (1 point) Saved 16 years ago, Delicious Mills, Inc. issued 30-year to maturity bonds that had a 7.41 percent annual coupon rate, paid semiannually. The bonds had a $1,000 face value. Since then, interest rates in general have changed and the yield to maturity on the Delicious Mills bonds is now 8.74 percent. Given this information, what is the price today for a Delicious Mills bond? Round the answer to two decimal places. Your Answer: 893.80 Answer Question 4 (1 point) Saved Dan is considering the purchase of Super Technology, Inc. bonds that were issued 8 years ago. When the bonds were originally sold they had a 22-year maturity and a 12.84 percent coupon interest rate, paid annually. The bond is currently selling for $877. Par value of the bond is $1,000. What is the yield to maturity on the bonds if you purchased the bond today? Round the answers to two decimal places in percentage form. (WWrite the percentage sign in the "units" box) You should use Excel or financial calculator. Your Answer: Answer units.
Your preview ends here
Eager to read complete document? Join bartleby learn and gain access to the full version
  • Access to all documents
  • Unlimited textbook solutions
  • 24/7 expert homework help