Bond prices. Price the bonds from the following table with annual coupon payments: a. Find the price for the bond in the following table: (Round to the nearest cent.) Years to Yield to Par Value Coupon Rate Maturity Maturity Price $1,000.00 10% 15 10%

Bond prices. Price the bonds from the following table with annual coupon payments: a. Find the price for the bond in the following table: (Round to the nearest cent.) Years to Yield to Par Value Coupon Rate Maturity Maturity Price $1,000.00 10% 15 10%

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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Bond prices. Price the bonds from the following table with semiannual coupon payments: a. Find the price for the bond in the following table: (Round to the nearest cent.) Years to Maturity 6 Data Table Par Value Coupon Rate Cancel $1,000 00 9% 25 (Click on the following icon in order to copy its contents into a spreadsheet.) Years to Matrity Par Valve $1,000.00 $1,000.00 $5,000.00 $5,000.00 Yield to Maturity 5% 9% Price 9% 25 5% 10% 30 25 6% 11% 25 10% Print Done Enterx OUE
Bond prices. Price the bonds from the following table with semiannual coupon payments: a. Find the price for the bond in the following table: (Round to the nearest cent.) Years to Yield to Par Value $1,000.00 Data table (Click on the following icon in order to copy its contents into a spreadsheet.) Yield to Maturity 8% Par Value Coupon Rate $1,000.00 $1,000.00 $5,000.00 $1,000.00 5% 7% 6% 9% Print Years to Maturity 20 30 10 10 HTTP Done 5% 9% 11% Price ? ? ? ? - X
a. Find the price for the bond in the following table: (Round to the nearest cent.) Years to Maturity |O Data Table Par Value Coupon Rate $1,000.00 6% 15 (Click on the following icon e in order to copy its contents into a spreadsheet.) Years to Yield to Maturity Maturity Price Coupon Rate 6% Par Value $1,000.00 $5,000.00 $5,000.00 $1,000.00 15 8% 9% 9% 5% 10 5% 11% 15 10% Print Done
Bond prices. Price the bonds from the following table with annual coupon LOADING... payments: LOADING... . a. Find the price for the bond in the following table: (Round to the nearest cent.) Par Value Coupon Rate Years to Maturity Yield to Maturity Price $5,000.00 5% 8% 20 $
1. table: Consider following three bonds whose features are summarized in the following Maturity (Years) Coupon Rate (%) YTM (%) Answer the following question by using Excel and show the cells that you use to calculate the values. 2 5 5.5 6 5 6 6 10 6.5 The face value of bonds is $100, YTM stands for yield to maturity, coupons are received annually. We structure a butterfly strategy (combination of bullet and barbell) in the following way: We sell 10000 5-year maturity bonds. We buy 5000 2-year maturity bonds and 5000 10-year maturity bonds. a) Suppose that one month later the YTM curve has changed. A flattening movement has happened so that the curve rotates around the body. We consider the following movement "+50/0/-50" meaning that the short wing YTM increases by 50 bps, the body does not move and the long wing YTM decreases by 50 bps. Compute the total return of the butterfly. b) Same question with a steepening movement "-50/0/+50".
Consider the following bonds: . What is the percentage change in the price of each bond if its yield to maturity falls from 6.3% to 5.3%? The price of bond A at 6.3% YTM per $100 face value is $ (Round to the nearest cent.) - X Data table (Click on the following icon g in order to copy its contents into a spreadsheet.) Bond Coupon Rate (annual payments) Maturity (years) A 0.0% 15 В 0.0% 10 3.6% 15 8.4% 10 Print Done
Yield to maturity The bond shown in the following table pays interest annually. (Click on the icon here O in order to copy the contents of the data table below into a spreadsheet.) Par value Coupon interest rate Years to maturity Current value $1,000 7% 9. $1,140 a. Calculate the yield to maturity (YTM) for the bond. b. What relationship exists between the coupon interest rate and yield to maturity and the par value and market value of a bond? Explain. a. The yield to maturity (YTM) for the bond is %. (Round to two decimal places.)
Show all workings. Complete the following table and draw a graph showing how bond pricefor each bond changes over time as they move towards their maturitydates. Describe the relationship between bond prices and timeremaining for maturity.YearsreminingtomaturityBOND ACoupon rate = 8% p.a.Market interest rate =6% p.a.BOND BCoupon rate = 6% p.a.Market interest rate =6% p.a.BOND CCoupon rate = 4% p.a.Market interest rate =6% p.a.109876543210
a. Find the price for the bond in the following table: (Round to the Years to Data Table Cancel Coupon Rate 12% Par Value Maturity $1,000.00 30 (Click on the following icon in order to copy its contents into a spreadsheet.) Yield to Years to Maturity Maturity 12% Par Value Coupon Rate Price $1,000.00 $5,000.00 12% 30 11% 15 11% $5,000.00 10% 10 6% $1,000.00 8% 20 7% Print Done
Calculate the purchase price of the following bonds. Indicate whether the bonds are priced at a discount, at par or at a premium. Give your answers in dollars and cents to the nearest cent. Face Value Coupon Rate Years to Maturity Market Rate a) $100 r = 6.75% 5 j2 = 6.75% b) $1,000 r = 8% 11 j2 = 6.25% c) $10,000 r = 7% 20 j2 = 8.75% Quoted coupon rates and market rates are nominal annual rates compounded semi-annually. a)Price = $ This bond is priced at:a discountpara premium b)Price = $ This bond is priced at:a discountpara premium c)Price = $ This bond is priced at:a discountpara premium
All computations must be done and shown manually Question 4 Complete the following table and draw a graph showing how bond price for each bond changes over time as they move towards their maturity dates. Describe the relationship between bond prices and time remaining for maturity. Please include graph as per above information Years remaining to maturity BOND A Coupon. rate = 8% p.a. Market interest rate = 6% p.a. BOND B Coupon rate = 6% p.a. Market interest rate = 6% p.a. BOND C Coupon rate = 4% p.a. Market interest rate = 6% p.a. 10 9 8 7 6 5 4 3 2 1 0
Data table 不 The following table summarizes prices of various default-free zero-coupon bonds (expressed as a percentage of face value): a. Compute the yield to maturity for each bond. b. Plot the zero-coupon yield curve (for the first five years). c. Is the yield curve upward sloping, downward sloping, or flat? a. Compute the yield to maturity for each bond. The yield on the 1-year bond is ☐ %. (Round to two decimal places.) (Click on the following icon in order to copy its contents into a spreadsheet.) Maturity (years) Price (per $100 face value) 1 $95.42 2 3 4 5 $90.99 $86.47 $81.58 $76.46 Print Done

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