Homework #4F (Bond Yield to Call. YTM and Price after original Issue)
docx
keyboard_arrow_up
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
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
Related Documents
Related Questions
What is the value of a bond that has a par value of $1,000, a coupon of $120 (annually), and matures in 10 years? Assume a required rate of return of .0702.
Instruction: Type your answer in dollars, and round to two decimal places.
arrow_forward
Give typing answer with explanation and conclusion
A 3-month zero-coupon bond is selling for $99.7 and a 10-year zero-coupon bond is selling for $55.7. Both bonds have a face value of $100. What's the 10-year - 3-month spread in their yields? Answer in percent, rounded to one decimal place.
arrow_forward
Consider the market rates for the maturities 1, 2, and 3 years respectively in the
table below. What is the price of a 3-year bond with annual payments, coupon rate
equal to 9.50% and face value equal to $68,000. Answer with two decimal digits
accuracy. Example: 74929.05
t
1
2
3
R(0,t)
1.95
2.90
4.40
Blank Excel Worksheet
Your Answer:
Answer
arrow_forward
Solve this one
arrow_forward
Given the following information on a bond,
Par value: $1000
Interest rate: 6%
Coupon rate: 8% paid semiannually
Years to maturity: 15 years,
what is the expected price at the end of year 5?
Question 7Select one:
a.
1145.32
b.
1152.98
c.
1148.77
d.
1141.97
please show math and explanation..
arrow_forward
What is the last payment amount of a bond with 1 payment per years, Coupon Rate
8.50% and principal and $514,000 principal and matures in 10 years? Answer with
two decimal digits accuracy. Example: 631062.50
arrow_forward
Can someone help me pls. Thank you!
arrow_forward
What is the value of a bond that matures in 17 years, makes an annual coupon payment of $50, and has a par value of $1,000? Assume a required rate of return of .0590.
Instruction: Type your answer in dollars, and round to two decimal places
arrow_forward
Question 1?
arrow_forward
Solve this problem
arrow_forward
Consider a bond with a current value of
$928.01.
It is a
10-year,
$1,000
bond, coupons paid semi-annually, and has a
7%
coupon rate.
a. The bond's yield to maturity (YTM) is:
b.
What
will be its value (per $1,000 of face) if its YTM changes to
10%?
Question content area bottom
Part 1
a. The YTM is
enter your response here%.
(Round to two decimal places.)
b. Value (per $1,000 of face):
$enter your response here.
(Round to the nearest cent.)
arrow_forward
Help
arrow_forward
Please don’t reject question , question is complete please answer answer all four parts. Thx
arrow_forward
Consider a bond (with par value = $1,000) paying a coupon rate of 10% per year semiannually when the market interest
rate is only 4% per half-year. The bond has three years until maturity.
Required:
a. Find the bond's price today and six months from now after the next coupon is paid.
b. What is the total (6-month) rate of return on the bond?
Complete this question by entering your answers in the tabs below.
Required A Required B
Find the bond's price today and six months from now after the next coupon is paid.
Note: Round your answers to 2 decimal places.
Current price
Price after six months
$
$
1,052.42
1,044.52
arrow_forward
Can you please answer the accounting question?
arrow_forward
Give typing answer with explanation and conclusion
arrow_forward
Consider two zero coupon bonds. Both have face values of $100. Bond A pays its face value in 8 years, and Bond B pays its face in 2 years. If interest rates change from 9% to 7%, what is the percentage change in the long maturity bond's price minus the percentage change in the short maturity bond's price? Express your answer in percentage form rounded to one decimal place.
arrow_forward
1. Consider a real return bond with a face value of $15,000 and a coupon yield of
5.2%. What is the coupon payment after one year if the inflation rate is 6.8%?
Select one:
a) $817.44
b) $833.04
c)
$825.24
d) $809.64
I
arrow_forward
A bond that matures in
10
years has a
$1,000
par value. The annual coupon interest rate is
8
percent and the market's required yield to maturity on a comparable-risk bond is
13
percent. What would be the value of this bond if it paid interest annually? What would be the value of this bond if it paid interest semiannually?
Question content area bottom
Part 1
a. The value of this bond if it paid interest annually would be
$enter your response here.
arrow_forward
Need help with this Question
arrow_forward
3.
A 6-year Circular File bond pays interest of $80 annually and sells for $950. Par value is $1,000 by assumption.
a)What is its coupon rate? (Round your answer to 2 decimal places.)
b) What is its current yield? (Round your answer to 2 decimal places.)
c) What is its yield to maturity? (Round your answer to 4 decimal places.)
arrow_forward
SEE MORE QUESTIONS
Recommended textbooks for you

Intermediate Financial Management (MindTap Course...
Finance
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Cengage Learning
Related Questions
- What is the value of a bond that has a par value of $1,000, a coupon of $120 (annually), and matures in 10 years? Assume a required rate of return of .0702. Instruction: Type your answer in dollars, and round to two decimal places.arrow_forwardGive typing answer with explanation and conclusion A 3-month zero-coupon bond is selling for $99.7 and a 10-year zero-coupon bond is selling for $55.7. Both bonds have a face value of $100. What's the 10-year - 3-month spread in their yields? Answer in percent, rounded to one decimal place.arrow_forwardConsider the market rates for the maturities 1, 2, and 3 years respectively in the table below. What is the price of a 3-year bond with annual payments, coupon rate equal to 9.50% and face value equal to $68,000. Answer with two decimal digits accuracy. Example: 74929.05 t 1 2 3 R(0,t) 1.95 2.90 4.40 Blank Excel Worksheet Your Answer: Answerarrow_forward
- Solve this onearrow_forwardGiven the following information on a bond, Par value: $1000 Interest rate: 6% Coupon rate: 8% paid semiannually Years to maturity: 15 years, what is the expected price at the end of year 5? Question 7Select one: a. 1145.32 b. 1152.98 c. 1148.77 d. 1141.97 please show math and explanation..arrow_forwardWhat is the last payment amount of a bond with 1 payment per years, Coupon Rate 8.50% and principal and $514,000 principal and matures in 10 years? Answer with two decimal digits accuracy. Example: 631062.50arrow_forward
- Can someone help me pls. Thank you!arrow_forwardWhat is the value of a bond that matures in 17 years, makes an annual coupon payment of $50, and has a par value of $1,000? Assume a required rate of return of .0590. Instruction: Type your answer in dollars, and round to two decimal placesarrow_forwardQuestion 1?arrow_forward
- Solve this problemarrow_forwardConsider a bond with a current value of $928.01. It is a 10-year, $1,000 bond, coupons paid semi-annually, and has a 7% coupon rate. a. The bond's yield to maturity (YTM) is: b. What will be its value (per $1,000 of face) if its YTM changes to 10%? Question content area bottom Part 1 a. The YTM is enter your response here%. (Round to two decimal places.) b. Value (per $1,000 of face): $enter your response here. (Round to the nearest cent.)arrow_forwardHelparrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Intermediate Financial Management (MindTap Course...FinanceISBN:9781337395083Author:Eugene F. Brigham, Phillip R. DavesPublisher:Cengage Learning

Intermediate Financial Management (MindTap Course...
Finance
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Cengage Learning