Self-Assessment HW4D (YTM Annually, Semi-annually)

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Consider a bond with maturity 2 year, 100 face value, coupon 3.60%, and yield 7.20%. Compute a dollar duration numerically using a dy =0.001%, Report you result with two digits decimal accuracy and the correct sign. Example:-185.95 Blank Excel Worksheet Your Answer: Answer

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Attempts 1 1 Keep the Highest 1/3 5. Problem 7.09 (Yield to Maturity) eBook Harrimon Industries bonds have 6 years left to maturity. Interest is paid annually, and the bonds have a $1,000 par value and a coupon rate of 10%. a. What is the yield to maturity at a current market price of 1. $843? Round your answer to two decimal places. % 2. $1,228? Round your answer to two decimal places. % b. Would you pay $843 for each bond if you thought that a "fair" market interest rate for such bonds was 13%-that is, if rd = 13%? I. You would not buy the bond as long as the yield to maturity at this price is less than the coupon rate on the bond. II. You would buy the bond as long as the yield to maturity at this price is greater than your required rate of return. III. You would buy the bond as long as the yield to maturity at this price is less than your required rate of return. IV. You would buy the bond as long as the yield to maturity at this price equals your required rate of return. V. You…

K Assume that a bond will make payments every six months as shown on the following timeline (using six-month periods): 0 2 5 Period $19.53 a. What is the maturity of the bond (in years)? b. What is the coupon rate (as a percentage)? c. What is the face value? Cash Flows View an example Get more help. ★ a. What is the maturity of the bond (in years)? The maturity is years. (Round to the nearest integer.) A 6 1 MacBook Pro & 7 $19.53 * 8 9 C 59 $19.53 60 $19.53+$1,000 Clear all BUB 0 {

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Acme Chemical, Inc. is a major manufacturer of chemical products for the agricultural ndustry, including pesticides, herbicides and other compounds. Due to a number of law suits elated to toxic wastes, Acme Chemical has recently experienced a market re-evaluation of its common stock. The firm also has a bond issue outstanding with 10 years to maturity and an annual coupon rate of 5 percent, with interest paid semi annually. The required nominal market annual interest rate on this bond has now risen to 10 percent due to the high risk level associated vith this firm. The bonds have a par or face value of $1,000. 1. Label each of the variables that you would use to determine the value of this bond in the market today: N (time periods until maturity) PMT (periodic interest payment) I per (periodic market interest rate) EV (future value to be received when the bond matures) = 2. Based on the variables that you have identified in Question #1, what is the market value. today (the present…

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Problem 6-14 Suppose you purchase a 30-year, zero-coupon bond with a yield to maturity of 6%. You hold the bond for five years before selling it. Complete the steps below using cell references to given data or previous calculations. In some cases, a simple cell reference is all you need. To copy/paste a formula across a row or down a column, an absolute cell reference or a mixed cell reference may be preferred. If a specific Excel function is to be used, the directions will specify the use of that function. Do not type in numerical data into a cell or function. Instead, make a reference to the cell in which the data is found. Make your computations only in the blue cells highlighted below. In all cases, unless otherwise directed, use the earliest appearance of the data in your formulas, usually the Given Data section. a. If the bond's yield to maturity is 6% when you sell it, what is the internal rate of return of your investment? b. If the bond's yield to maturity is 7% when you sell…

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QUESTION 1 "A coupon bond that pays interest annually has a par value of $1000, matures in 6 years, and has a yield to maturity of 6%. If the coupon rate is 15%, the value of the bond today will be __________. Note: Express your answers in strictly numerical terms. For example, if the answer is $500, write enter 500 as an answer."    QUESTION 2 "A coupon bond that pays interest quarterly has a par value of $1000, matures in 4 years, and has a yield to maturity of 15%. If the coupon rate is 8%, the value of the bond today will be __________. Note: Express your answers in strictly numerical terms. For example, if the answer is $500, write enter 500 as an answer."    QUESTION 3 "What is the coupon payment of a 4-year $1000 bond, 9% YTM, and with a 2% coupon rate and semiannually payments? Note: Express your answers in strictly numerical terms. For example, if the answer is $500, write enter 500 as an answer."   QUESTION 4 "Consider a zero-coupon bond with $100 face value and 5…

Question 4 (3 points) Consider a 35-year coupon bond with a face value of $1,000 that pays $80 annual coupons (beginning one year from today). Assume that you invest each coupon in a bank that pays 8% interest. By the maturity date: A) Calculate the future value of coupons reinvested at 8% (Use all decimals on your calculations and include your answer with 2 decimals. Do not include symbols or comma separators eg. Assume the correct answer is $1,289.54632, so input your answer as 1289.55) B) How much interest is earned for reinvesting the coupons? (Use all decimals in your calculations and include your answer with 2 decimals. Do not include symbols or comma separators eg. Assume the correct answer is $1,289.54632, so input your answer as 1289.55) C) Calculate the interest earned for reinvesting coupons, as a proportion of all money received for owning the bond until maturity. (Use all decimals in your calculations and include your answer in percentual form with 2 decimals. Do not…

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