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Bond prices. Price the bonds from the folloing table with quarterly coupon payments: Hint: Make sure to round all intermediate calculations to at least seve decimal places O Data Table (Click on the following icon in order to copy its contents into a spreadsheet) Years to Yield to Coupon Rate Maturity Par Value Maturity Price $5,000 00 $1,000 .00 $1,000.00 $5,000.00 11% 10 11% 7% 5% 6% 6% 10% 10 12%

Bond prices. Price the bonds from the folloing table with quarterly coupon payments: Hint: Make sure to round all intermediate calculations to at least seve decimal places O Data Table (Click on the following icon in order to copy its contents into a spreadsheet) Years to Yield to Coupon Rate Maturity Par Value Maturity Price $5,000 00 $1,000 .00 $1,000.00 $5,000.00 11% 10 11% 7% 5% 6% 6% 10% 10 12%

Essentials Of Investments
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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The image displays a data table used to calculate bond prices with quarterly coupon payments. The table includes five rows, each representing a different bond scenario with various attributes such as par value, coupon rate, years to maturity, and yield to maturity. The price column is left blank, indicating the need for calculation. ### Data Table | Par Value | Coupon Rate | Years to Maturity | Yield to Maturity | Price | |-----------|-------------|-------------------|-------------------|-------| | $1,000.00 | 13% | 10 | 11% | ? | | $5,000.00 | 7% | 5 | 5% | ? | | $1,000.00 | 6% | 5 | 6% | ? | | $2,000.00 | 9% | 10 | 12% | ? | | $5,000.00 | 10% | 5 | 12% | ? | **Instructions:** - Use the given par value, coupon rate, years to maturity, and yield to maturity to calculate the missing bond prices. - Ensure calculations are rounded to at least seven decimal places for accuracy. **Notes:** - Bonds with higher yields compared to their coupon rates typically are priced below par value. - Conversely, when the yield is lower than the coupon rate, bonds are typically priced above par value. This exercise is designed to reinforce the understanding of bond pricing and the relationship between various bond characteristics.
Transcribed Image Text:The image displays a data table used to calculate bond prices with quarterly coupon payments. The table includes five rows, each representing a different bond scenario with various attributes such as par value, coupon rate, years to maturity, and yield to maturity. The price column is left blank, indicating the need for calculation. ### Data Table | Par Value | Coupon Rate | Years to Maturity | Yield to Maturity | Price | |-----------|-------------|-------------------|-------------------|-------| | $1,000.00 | 13% | 10 | 11% | ? | | $5,000.00 | 7% | 5 | 5% | ? | | $1,000.00 | 6% | 5 | 6% | ? | | $2,000.00 | 9% | 10 | 12% | ? | | $5,000.00 | 10% | 5 | 12% | ? | **Instructions:** - Use the given par value, coupon rate, years to maturity, and yield to maturity to calculate the missing bond prices. - Ensure calculations are rounded to at least seven decimal places for accuracy. **Notes:** - Bonds with higher yields compared to their coupon rates typically are priced below par value. - Conversely, when the yield is lower than the coupon rate, bonds are typically priced above par value. This exercise is designed to reinforce the understanding of bond pricing and the relationship between various bond characteristics.
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