A company issues a callable (at par) 20-year, 5% coupon bond with annual coupon payments. The bond can be called at par in one year after release or any time after that on a coupon payment date. On release, it has a price of $104 per $100 of face value. What is the yield to worst of this bond when it is released? OA. 1.35% OB. 0.90% OC. 0.77% OD. 1.54%

A company issues a callable (at par) 20-year, 5% coupon bond with annual coupon payments. The bond can be called at par in one year after release or any time after that on a coupon payment date. On release, it has a price of $104 per $100 of face value. What is the yield to worst of this bond when it is released? OA. 1.35% OB. 0.90% OC. 0.77% OD. 1.54%

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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What is the coupon rate of a ten-year, $10,000 bond with semiannual coupons and a price of $9,558.57, if it has a yield to maturity of 6.6%? OA. 7.188% OB. 5.99% OC. 4.792% OD. 8.386%
General Electric has just issued a callable (at par) 10- year, 5.7% coupon bond with annual coupon payments. The bond can be called at par in one year or anytime thereafter on a coupon payment date. It has a price of $ 102.15. a. What is the bond's yield to maturity? b. What is its yield to call? c. What is its yield to worst? Question content area bottom enter your response here %. (Round to two decimal places.)
a $1000 face value bond has a 9.0% coupon and pays interest semiannually. The bond matures in 2 yeas and has a yield to maturity of 6.5%. what is the Macaulay duration? *Please show work, DO NOT USE EXCEL*
Bond P is a premium bond with a 10 percent coupon. Bond D is a 6 percent coupon bond currently selling at a discount. Both bonds make annual payments, have a YTM of 8 percent, and have five years to maturity. (Assume par value of K1,000)(i) What is the current yield for Bond P and Bond D?(ii) If interest rates remain unchanged, what is the expected capital gains yield over the next year for Bond P? For Bond D?(iii)Explain your answers and the interrelationship among the various types of yields.
Consider a bond that is currently priced at $1100. If the face value of the bond is $1000, coupon payments are made semiannually, the bond matures in 5 years, and the YTM is 3%, what is the coupon rate? Group of answer choices 5.17% 2.58% 3.00% $25.84
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You purchase a zero coupon bond with 12 years to maturity and a yield to maturity of 4.93 percent. The bond has a par value of $1,000. What is the implicit interest for the first year? Assume semiannual compounding. a.$27.12 b.$26.89 c.$27.82 d.$24.34 e.$26.71
You purchase a zero coupon bond with 14 years to maturity and a yield to maturity of 5.01 percent. The bond has a par value of $1,000. What is the implicit interest for the first year? Assume semiannual compounding. Multiple Choice $24.74 $24.36 $24.53 $22.20 $25.37
D Bond P is a premium bond with a 9 percent coupon. Bond D is a 4 percent coupon bond currently selling at a discount. Both bonds make annual payments, have a YTM of 6 percent, and have four years to maturity. What is the current yield for Bond P and Bond D? (Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16)) Bond P Bond Current yield 8.15% 4.30 % If interest rates remain unchanged, what is the expected capital gains yield over the next year for Bond P and Bond D? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16))) Bond P Bond D Capital gains yield -2.15 % 1.70 %
Consider a bond with a face value of $1,000 that sells for an initial price of $700. It will pay no coupons for the first nine years and will then pay 11% coupons for the remaining 29 years. Choose an equation showing the relationship between the price of the bond, the coupon (in dollars), and the yield to maturity. O A. B. O C. O D. 700 = 700 = 700 = 700 = 110 110 9 (1+i)⁹ (1+i)⁹+1 + 110 + i) ⁹ + 1 (1 + 1,000 (1+i) 29-9 1,000 (1 + i) 9 +29 + +...+ 110 (1+i) 9+2 + 110 (1 + i)9+29-1 110 + (1 + i) ⁹ + 110 (1+i)9 +29 9+29-1 + 110 (1 + i)9 +29 + 1,000 (1+i) 9+29
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Please show working Please answer ALL OF QUESTIONS 1 AND 2 1. A 7% semiannual coupon bond matures in 6 years. The bond has a face value of $1,000 and a current yield of 7.5219%.a. What is the bond's price? Do not round intermediate calculations. Round your answer to the nearest cent.b. What is the bond's YTM? (Hint: Refer to Footnote 6 for the definition of the current yield and to Table 7.1) Do not round intermediate calculations. Round your answers to two decimal places. 2. Nesmith Corporation's outstanding bonds have a $1,000 par value, a 7% semiannual coupon, 18 years to maturity, and a 9% YTM. What is the bond's price? Round your answer to the nearest cent.

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