A bond has nine years to maturity, a $2,000 face value, and a 6.5% coupon rate with annualcoupons. What is its yield to maturity if it is currently trading at $1,643 ?A. 9.55%B. 7.64%C. 11.45%D. 13.36%

To find the yield to maturity (YTM) for the bond, we need to solve for the interest rate r in the…

Answered: A bond has nine years to maturity, a…

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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A bond has a coupon rate of 6%, a face value of $1,000, and a maturity of 12 years. If the yield to maturity is 7%. What is the market price of the bond? 916.16 919.71 920.57
A bond has nine years to maturity, a $2,000 face value, and a 5.7% coupon rate with annual coupons. What is its yield to maturity if it is currently trading at $1,566? OA. 13.13% OB. 11.25% OC. 9.38% OD. 7.5%
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Sunnyfax Publishing pays out all its earnings and has a share price of $37.00. In order to expand, Sunnyfax Publishing decides to cut its dividend from $3.00 to $2.00 per share and reinvest the retained funds. Once the funds are reinvested, they are expected to grow at a rate of 14%. If the reinvestment does not affect Sunnyfax's equity cost of capital, what is the expected share price as a consequence of this decision? O$45.87 $40.14 $68.81 $57.34
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A bond has nine years to maturity, a $2,000 face value, and a 6.5% coupon rate with annual coupons. What is its yield to maturity if it is currently trading at $1,643 ? A. 9.55% B. 7.64% C. 11.45% D. 13.36%