**Problem Statement:**A 25-year, $1,000 par value bond has an 8.5% annual payment coupon. The bond currently sells for $925. If the yield to maturity remains at its current rate, what will the price be 5 years from now?- a. $744.09- b. $930.11- c. $865.00- d. $883.61- e. $976.62**Explanation:**This problem involves calculating the future price of a bond, given its current selling price, coupon rate, and yield to maturity over a specified timeframe. The listed answer options provide possible future bond prices.

A 25-year, $1,000 par value bond has an 8.5% annual payment coupon. The bond currently sells for $925. If the yield to maturity remains at its current rate, wh will the price be 5 years from now? O a. $744.09 O b. $930.11 O C. $865.00 O d. $883.61 e. $976.62

A 25-year, $1,000 par value bond has an 8.5% annual payment coupon. The bond currently sells for $925. If the yield to maturity remains at its current rate, wh will the price be 5 years from now? O a. $744.09 O b. $930.11 O C. $865.00 O d. $883.61 e. $976.62

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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Question

**Problem Statement:**

A 25-year, $1,000 par value bond has an 8.5% annual payment coupon. The bond currently sells for $925. If the yield to maturity remains at its current rate, what will the price be 5 years from now?

- a. $744.09
- b. $930.11
- c. $865.00
- d. $883.61
- e. $976.62

**Explanation:**

This problem involves calculating the future price of a bond, given its current selling price, coupon rate, and yield to maturity over a specified timeframe. The listed answer options provide possible future bond prices.

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What is the return on a bond that was issued at 9% coupon rate, 10% YTM, for five years, Face value of $1000 if YTM changed from 10% to 12% after the receipt of the first coupon and the bond was sold (the bond was sold at the beginning of the second year? A) 11, 50% B. 6, 98% C. 8,23 % D. 11,00%
$1,000 par value bond sells for $1,092. It matures in 20 years, has a 10 percent coupon rate, and pays interest semi- annually. What is the bond's yield to maturity? 4.50% 9.30% 9.00 % 10.51 % 10.75 % There is not enough information provided to answer this question .
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