A 20-year, 10% monthly-pay bond has a par value of $1,000. If the price of the bond is $887.14, its yield-to-maturity (YTM) is closest to A. 11.44%. B. 12.29%. C. 14.92%. D. 35.05%.
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A 20-year, 10% monthly-pay bond has a par value of $1,000. If the price of the bond is $887.14, its yield-to-maturity (YTM) is closest to
11.44%.
12.29%.
14.92%.
35.05%.
Step by step
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- A 7-year, 10% annual-pay bond has a par value of $1,000. If its yield-to-maturity (YTM) is 12.4%, the amount earned from reinvestment of the coupon payment is closest to A. $239.47. B. $321.41. C. $480.06. D. $500.79.A bond with a 8-year duration is worth $1,074, and its yield to maturity is 7.4%. If the yield to maturity falls to 7.30%, you would predict that the new value of the bond will be approximately _________. a)$1,082.06 b)$1,075.07 c)$1,074.00 d) $1,072.93A 14-year, $1,000 par value Fingen bond pays 6% interest annually (assume semi- annual payments). The price of the bond is $1,100 and the market's required yield to maturity on a comparable-risk bond is 5.50%. a. Compute the bonds yield to maturity. b. Determine the value of the bond to you, given your required rate of return (the YTM on a comparable-risk bond). c. Should you purchase the bond? a. b. Coupon rate Par (FV) Years (n) m PMT PV (price) YTM Coupon rate Par (FV) Years (n) m PMT PV (price) YTM 6.0% $1,000 14 2 $30 Calculation $1,100 6.0% $1,000 14 2 $30 Calculation Note: if you want PV to be a positive number, you must use a minus sign for both pmt and FV 5.50%
- Assume that a $10,000.00 bond paying 8.5% interest is currently selling at 106. What is the current selling price of the bond? What is the current yield of this bond? a. b. (Assume that a $10,000.00 bond paying 8.5% interest is currently selling at 106. a. What is the current selling price of the bond?b. What is the current yield of this bond?The Salem Company bond currently sells for $848.55, has a coupon interest rate of 14%and a $1000 par value, pays interest annually, and has 16 years to maturity. a. Calculate the yield to maturity (YTM) on this bond. b. Explain the relationship that exists between the coupon interest rate and yield to maturity and the par value and market value of a bond.
- A bond has a $1,000 par value, 6 years to maturity, a 13 percent annual coupon, and sells for $1,093. What is the bond’s yield to maturity (YTM)? a. 10.93% b. 10.81% c. 11.89% d. 13.00% e. 14.58%A four-year discount bond has a face value of $1,000 and a price of $925. What is the yield to maturity on the bond?An n-year bond with semi-annual coupon payments has the following characteristics: • Par value is $100. • Redemption value is 105% of par. • Semi-annual coupon rate is r. • Semi-annual yield rate is i. • Price of the bond is $64.34. You are also given: (1+ i)-" = 0.3878 Calculate (A) 0.57 (B) 0.87 (C) 1.16 (D) 1.46 (E) 1.75
- A 20-year maturity bond with par value of $1,000 makes semiannual coupon payments at a coupon rate of 8%. Find the bond equivalent and effective annual yield to maturity of the bond if the bond price is: a. $950. b. $1,000. c. $1,050.A bond with a 8-year duration is worth $1,077, and its yield to maturity is 7.7%. If the yield to maturity falls to 7.57%, you would predict that the new value of the bond will be approximately Multiple Choice $1,075.60 $1,077.00 $1,087.45 $1,078.40A fourteen-year bond has a 10% coupon rate and a face value of $1,000. If the current price of the bond is $875, calculate the yield to maturity of the bond assuming semiannual interest payments. 11.51%. 11.85%. 12.75%. 5.93%.