An investor buys a $1,000, 20-year 7 percent (interest paid annually) bond at par. After five years have passed, interest rates are 10 percent. How much did the investor lose on the purchase of the bond?
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An investor buys a $1,000, 20-year 7 percent (interest paid annually) bond at par. After five years have passed, interest rates are 10 percent. How much did the investor lose on the purchase of the bond?
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- An investor buys a $1,000, 20 year 6 percent (interest paid semiannually) bond at par. After five years have passed, interest rates are 11 percent. How much did the investor lose on the purchase of the bond?An investor purchases a 20-year, $1,000 par value bond that pays semiannual interest of $40. If the semiannual market rate of interest is five percent, what is the current market value of the bond?An investor buys a bond for $10,000. The bond pays $200 interest every six months. After 18 months, the investor sells the bond for $9,500. Describe the types of income and/or loss the investor had.
- You buy a 6% 1,000 bond for $1,000, immediately after semiannual interest has been paid to the previous owner. Eight years later, you sell the bond for $990.50, immediately after you receive the semiannual interest check. What is your yield during ownership?A bond with a face value of $1000 can be purchased for $800. The bond will mature 5 years from now, and the bond dividend rate is 6%. Dividends are paid every 6 months. What effective interest rate would an investor receive if she purchased the bond?a) What is the value of a 10 year, 8.2% coupon bond with semiannual coupons.Assume the par value of the bond is $100 and it is redeemable at par. The interest rate (nominal, converted semiannually) is 10.6%. b) An investor purchased a bond that pays $5 coupons annually at the end of everyyear for five years. The purchase price was $100 and it was redeemed at par after fiveyears. If the annual effective inflation rate over the time period was 3%, calculate the realrate of return earned by the investor on this bond.
- The saleemi corporation’s $1,000 bonds pay 6 percent interest annually and have 11 years until maturity. You can purchase the bond for $875. A. What is the yield to maturity on this bond? B. Should you purchase the bond if the yield to maturity on a comparable-risk bond is 6 percent? A. The yield to maturity on the saleemi bonds is Round to two decimal placesAn investor purchases a 10-year, $5,000 face value bond that pays semiannual interest at annual rate of 10%. If the annual market rate of interest is 8%, what is the current market value of the bond? $5,679.52 $5,405.55 $4,376.89 $5,000.00A buyer purchases a $1000 face value bond that pays a 5% coupon on January 1 and July 1st of each year. He buys the bond on February 2 for $980. What's the buyer's total outlay?
- The Saleemi Corporation's $1,000 bonds pay 6 percent interest annually and have 14 years until maturity. You can purchase the bond for $1,085. Should you purchase the bond if the yield to maturity on a comparable-risk bond is 7 percent?on Assume that you purchase a 30-year stripped bond with a $100,000 face value. The current bond price is $9,937.73 and the yield is 8%. Calculate the interest revenue during the first year of holding the bond. Calculate amounts to nearest dollar, no $. Answer:An investor bought a $7,500 bond with a coupon rate of 5.3% compounded semi-annually. At the time of purchase, the bond had a yield rate of 4.4% and nine years until maturity. Four years later, the investor sold the bond when the yield to maturity was 5.5%. a. At what price did the investor purchase the bond? b. At what price did the investor sell the bond? c.What was the investor's capital gain or loss on the investment?