A Japanese company has a bond outstanding that sells for 90 percent of its ¥100,000par value. The bond has a coupon rate of 4.9 percent paid annually and matures in 20years. What is the yield to maturity of this bond? (Do not round intermediatecalculations and enter your answer as a percent rounded to 2 decimal places, e.g.,32.16.)Yield to maturity( Prev5 of 10Next

The yield to maturity can be calculated as follows : Results obtained :

A Japanese company has a bond outstanding that sells for 90 percent of par value. The bond has a coupon rate of 4.9 percent paid annually and n years. What is the yield to maturity of this bond? (Do not round intermedi. calculations and enter your answer as a percent rounded to 2 decimal p 32.16.) Yield to maturity %

A Japanese company has a bond outstanding that sells for 90 percent of par value. The bond has a coupon rate of 4.9 percent paid annually and n years. What is the yield to maturity of this bond? (Do not round intermedi. calculations and enter your answer as a percent rounded to 2 decimal p 32.16.) Yield to maturity %

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 zero-coupon bond with face value $1,000 and maturity of five years sells for $741.22. a. What is its yield to maturity? (Round your answer to 2 decimal places.) Yield to maturity % b. What will the yield to maturity be if the price falls to $725? (Round your answer to 2 decimal places.) Yield to maturity %
Rolling Company bonds have a coupon rate of 6.20 percent, 25 years to maturity, and a current price of $1,196. What is the YTM? The current yield? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) YTM % Current yield %
i. Calculate the value of Macaulay’s duration for a 10-year, $1000 par value bond purchased today at a yield to maturity of 14% and a coupon rate of 10%. ii. From the answer in (i) calculate the modified duration of the bond assuming the prevailing interest rate is still 14%.iii. Now suppose the market interest rate on comparable bonds falls to 13 percent. What will be the approximate percentage change in the bond price.? (Hint: use the modified duration for your computation in (ii))
Suppose you are given the following information about the default-free, coupon-paying yield curve: Maturity (years) Coupon rate (annual payment) YTM 1 0.00% 2.587% a. Use arbitrage to determine the yield to maturity of a two-year zero-coupon bond. b. What is the zero-coupon yield curve for years 1 through 4? Note: Assume annual compounding. 2 11.00% 4.008% a. Use arbitrage to determine the yield to maturity of a two-year zero-coupon bond. The yield to maturity of a two-year, zero-coupon bond is %. (Round to two decimal places.) b. What is the zero-coupon yield curve for years 1 through 4? The yield to maturity for the three-year and four-year zero-coupon bond is found in the same manner as the two-year zero-coupon bond. The yield to maturity on the three-year, zero-coupon bond is %. (Round to two decimal places.) The yield to maturity on the four-year, zero-coupon bond is %. (Round to two decimal places.) Which graph best depicts the yield curve of the zero-coupon bonds? (Select the…
pm.1
A firm's bonds have a maturity of 12 years with a $1,000 face value, have an 11% semiannual coupon, are callable in 6 years at $1,209.43, and currently sell at a price of $1,365.89. What are their nominal yield to maturity and their nominal yield to call? Do not round intermediate calculations. Round your answers to two decimal places. YTM: % YTC: % What return should investors expect to earn on these bonds? I. Investors would expect the bonds to be called and to earn the YTC because the YTC is less than the YTM. II. Investors would expect the bonds to be called and to earn the YTC because the YTC is greater than the YTM. III. Investors would not expect the bonds to be called and to earn the YTM because the YTM is greater than the YTC. IV. Investors would not expect the bonds to be called and to earn the YTM because the YTM is less than the YTC.
Suppose 1-year Treasury bonds yield 4.40% while 2-year T-bonds yield 5.70%. Assuming the pure expectations theory is correct, and thus the maturity risk premium for T-bonds is zero, what is the yield on a 1-year T-bond expected to be one year from now? Do not round your intermediate calculations. Round your final answer to 2 decimal places. a. 7.02% b. 5.66% c. 5.05% Od. 4.92% e. 7.32%
A firm's bonds have a maturity of 12 years with a $1,000 face value, have an 11% semiannual coupon, are callable in 6 years at $1,211.14, and currently sell at a price of $1,370.78. What are their nominal yield to maturity and their nominal yield to call? Do not round intermediate calculations. Round your answers to two decimal places. YTM: % YTC: % What return should investors expect to earn on these bonds? Investors would not expect the bonds to be called and to earn the YTM because the YTM is greater than the YTC. Investors would not expect the bonds to be called and to earn the YTM because the YTM is less than the YTC. Investors would expect the bonds to be called and to earn the YTC because the YTC is less than the YTM. Investors would expect the bonds to be called and to earn the YTC because the YTC is greater than the YTM.
A firm's bonds have a maturity of 8 years with a $1,000 face value, have an 8% semlannual coupon, are callable in 4 years at $1,048.54, and currently sell at a price of $1,094.91. What are their nominal yield to maturity and their nominal yield to call? Do not round Intermediate calculations. Round your answers to two decimal places. YTM: YTC: What return should investors expect to earn on these bonds? I. Investors would not expect the bonds to be called and to earn the YTM because the YTM is greater than the YTC. II. Investors would not expect the bonds to be called and to earn the YTM because the YTM is less than the YTC. III. Investors would expect the bonds to be called and to earn the YTC because the YTC is less than the YTM. IV. Investors would expect the bonds to be called and to earn the YTC because the YTC is greater than the YTM. -Select-
1. Bond prices and yields (S3.1) A 10-year bond is issued with a face value of $1,000, paying interest of $60 a year. If interest rates increase shortly after the bond is issued, what happens to the bond's a. Coupon rate? b. Price? c. Yield to maturity?
4. The bonds of CEPS Group sells for OMR 896.67. The yield to maturity is 11 percent and thematurity date is 10 years from today. What is the annual coupon rate of this bond if the facevalue is $1,000?
A European company issues a bond with a par value of $1,000, 13 years to maturity, and a coupon rate of 6 percent paid annually. If the yield to maturity is 11 percent, what is the current price of the bond? Group of answer choices $640.46 $622.56 $658.44 $662.51 $636.66

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