None Attempts3. Problem 13-04eBookKeep the Highest/3Problem 13-04Carrie's Clothes, Inc. has a seven-year bond outstanding that pays $60 annually. The face value of each bond is $1,000, and the bond sells for $860.a. What is the bond's coupon rate? Round your answer to two decimal places.%b. What is the current yield? Round your answer to two decimal places.%c. What is the yield to maturity? Use Appendix B and Appendix D to answer the question. Round your answer to the nearest whole number.%

Answer:(a). (b). (c).Yield to Maturity (YTM)The yield to maturity can be approximated using a…

Answered: Attempts 3. Problem 13-04 eBook Keep…

Financial Management: Theory & Practice

16th Edition

ISBN:9781337909730

Author:Brigham

Publisher:Brigham

Chapter5: Bonds, Bond Valuation, And Interest Rates

Section: Chapter Questions

Problem 24SP

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#2 A couple purchased a bond for $950.00 three years ago. The bond pays 7.625% APR with semi-annual coupons with a face value of $1,000. Currently, the bond has exactly 10 years until maturity, and investors seek a return of 12.00% APR on bonds of similar risk. What is the current price of the bond? Submit Answer format: Currency: Round to: 2 decimal places. Hide Hint A couple purchased a bond for $950.00 three years ago. The bond pays 6% APR with semi-annual coupons with a face value of $1,000. Currently, the bond has exactly 10 years until maturity, and investors seek a return of 9% APR on bonds of similar risk. What is the current price of the bond? SOLUTION: Bond Price = PV of Bond Cash Flows Po= = CPN y' -x1- + 1+ Face Value (1+ y')N' APR%x Face Value 6%x$1,000 Coupon CPN = = = $30 per 6 months m 2 y' = y = m 9% 2 = 4.50% per 6 months N' = = Nxm = 10x2 = 20 coupons remaining Po $30 0.045 x(1-(1,045)20) + $1,000 (1.045) 20 = $804.88 KEY POINT: For pricing the bond today, the price…
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Consider the following bond where the coupons are paid annually, Bond Price YTM Years to maturity CIBC $976.75 11% 6 years What is the coupon rate of this bond? The face value of the bond is $1,000. Enter your answer as a percentage. Do not include the percentage sign in your answer. Enter your response below. Enter your answer rounded to 2 DECIMAL PLACES. Number %
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Problem 15-18 Suppose that the prices of zero-coupon bonds with varlous maturitles are glven In the following table. The face value of each bond Is $1,000. TI Maturity Price (Years) 1 $ 945.66 2 855.09 3 785.92 4 718.40 5 660.24 a. Calculate the forward rate of Interest for each year. (Round your answers to 2 decimal places.) Maturity (years) Forward Rate 2 % 3 4 % b. How could you construct a 1-year forward loan beginning In year 3? (Round your Rate of synthetic loan answer to 2 decimal places.) Face value Rate of synthetic loan %
# 1 The market price of a semi-annual pay bond is $983.24. It has 15.00 years to maturity and a coupon rate of 5.00%. Par value is $1,000. What is the yield to maturity? Submit Answer format: Percentage Round to: 4 decimal places (Example: 9.2434%, % sign required. Will accept decimal format rounded to 6 decimal places (ex: 0.092434)) unanswered not_submitted Attempts Remaining: Infinity #2 Assume a par value of $1,000. Caspian Sea plans to issue a 11.00 year, semi-annual pay bond that has a coupon rate of 8.11%. If the yield to maturity for the bond is 7.79%, what will the price of the bond be? Submit Answer format: Currency: Round to: 2 decimal places. unanswered not_submitted Attempts Remaining: Infinity
Consider 2 securities with face value equal to 100. One year pure discount bond selling at $95. - One two year 8% discount bond selling at $96.5. What is the two year zero coupon rate R(0,2)? 10.02% 8.7% 10.22% 5.26%

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