14.. Fly Adventures issues bonds due in 10 years with a stated interest rate of 6% and a face value of $500,000. Interest payments are made semi-annually. The market rate for this type of bond is 5%. What is the issue price of the bonds? A. $537,194. B. $464,469. C. $538,973. D. $500,000. PV 1 2.5% 20pds 61027 PV 13% 10pds .74409 PVA 2.5% 20pds 15.56816 PVA 3% 20pds 14.87747

14.. Fly Adventures issues bonds due in 10 years with a stated interest rate of 6% and a face value of $500,000. Interest payments are made semi-annually. The market rate for this type of bond is 5%. What is the issue price of the bonds? A. $537,194. B. $464,469. C. $538,973. D. $500,000. PV 1 2.5% 20pds 61027 PV 13% 10pds .74409 PVA 2.5% 20pds 15.56816 PVA 3% 20pds 14.87747

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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9. Sean Corp. issued a $40,000, 10-year bond, with a stated rate of 8%, paid semiannually. How much cash will the bond investors receive at the end of the first interest period? a.$1,600 b.$4,000 c.$3,200 d.$800
QUESTION 38 ABC Inc. plans to issue $500,000 face value bonds with a stated interest rate of 10% and market interest rate of 12%. They will mature in 10 years. Interest will be paid semiannually. At the date of issuance, compute the present value (bond issue price) of the future cash flows. Following are appropriate factors from tables: Table % / n Present Value of $1 Present Value of ordinary annuity of $1 10%/10 .38554 6.14457 12%/10 .32197 5.65022 5%/20 .37689 12.46221 6%/20 .31180 11.46992 $286,748 $155,900 $442,648 $467,455.25
Marwick Corporation issues 10%, 5 year bonds with a par value of $1,050,000 and semiannual interest payments. On the issue date, the annual market rate for these bonds is 8%. What is the bond's issue (selling) price, assuming the following Present Value factors: n= 5 10 5 10 i= 10% 5% 8% 4% Multiple Choice O Present Value of an Annuity 3.7908 7.7217 3.9927 8.1109 C $624,178 $1,475,822 $1.135.202 Present value of $1 0.6209 0.6139 0.6806 0.6756
QUESTION 1 UMass Boston issued bonds to pay for the construction of the residencce halls. One of their bond issues pays a coupon of $43.76 twice a year. What is the coupon rate? Answer as a percent. QUESTION 2 What is the coupon rate for the bond? Assume semi-annual payments. Answer as a percent! Coupon Rate Bond City of Somerville ? Yield 4.4% Price $990.90 t 18
The following information applies to this question: Johnson Corporation plans to obtain financing with a $1,000,000 bond issue that has a term of 10 years. Payments wilI be made semi-annually. if the bond (payment) rate is stated at 7%, and the bonds call for semi-annual payments, what is the amount of those payments? O a. $350,000 O b. $70,000 OC. $35,000 d. $700,000
P6-20 Bond valuation: Annual interest Calculate the value of each of the bonds shown in the following table, all of which pay interest annually. Bond A B C D E Par value $1,000 1,000 100 500 1,000 Coupon rate 11% 8 9 6 7 Years to maturity 20 16 8 13 10 Required return 12% 8 7 8 5
42. A bond pays 9% yearly interest in semi-annual payments for 6years. The current yield on similar bonds is 12%. To determinethe market value of this bond, you musta. find the interest factors (IFs) for 12 periods at 12%.b. find the interest factors (IFs) for 6 periods at 9%.c. find the interest factors (IFs) for 6 periods at 6%.d. find the interest factors (IFs) for 12 periods at 6%.43. What is the approximate yield to maturity for a seven-year bondthat pays 11% interest on a $1000 face value annually if thebond sells for $952a. 10.5%b. 10.6%c. 11.5%d. 12.1%44. A ten-year bond pays 11% interest on a $1000 face valueannually. If it currently sells for $1,195, what is itsapproximate yield to maturity?a. 9.33%b. 7.94%c. 12.66%d. 8.10%
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Brooks Books’ bonds have 13 years remaining to maturity. Interest is paid annually; they have a $1,000 par value; the coupon interest rate is 8 percent; and the yield to maturity is 7.5 percent. What is the bond’s current market price? a. $1,000.00 b. $980.72 c. $1,040.63 d. $650.07 e. $1,080.00

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