Determine the purchase price at the indicated time before maturity of the following bond redeemed at par shownin the table below.Par Value$9,000Bond Rate PayableSemi-Annually10.5%Time Before Maturity Yield Rate9 years11.5%Conversion Periodsemi-annuallyThe purchase price of the bond is $(Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places asneeded.)

Par value (FV) = $9,000 Semi annual coupon amount (C) = 9000*0.1050/2 = $472.50 Years to maturity =…

Determine the purchase price at the indicated time before maturity of the following bond redeemed at par shown in the table below. Par Value $9,000 Bond Rate Payable Semi-Annually 10.5% Time Before Maturity 9 years Yield Rate 11.5% Conversion Period semi-annually The purchase price of the bond is $ (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)

Determine the purchase price at the indicated time before maturity of the following bond redeemed at par shown in the table below. Par Value $9,000 Bond Rate Payable Semi-Annually 10.5% Time Before Maturity 9 years Yield Rate 11.5% Conversion Period semi-annually The purchase price of the bond is $ (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)

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 interest rate on one-year Treasury bonds is 0.8 percent, the rate on two-year T-bonds is 0.9 percent, and the rate on three-year T-bonds is 1.0 percent. Using the expectations theory, compute the expected one-year interest rate in the second year (Year 2 only). Round your answer to one decimal place. % Using the expectations theory, compute the expected one-year interest rate in the third year (Year 3 only). Round your answer to one decimal place. %
Assume that a 5-year bond pays interest of $90 once a year (1 payment / year) and will mature for $1,000. Also assume that the yield to maturity on this bond is currently 10 percent. Given this information, determine the duration of this bond. Enter your answer in decimal format, truncated to 2 decimal places. For example, if your answer is 7.1186 years, enter "7.11".
2. A 15-year $12,000 bond at 5.2% compounded semi-annually was issued on May 15, 2015. The bond is purchased on February 26, 2018 to yield 4.1% compounded semi-annually. a. What is the purchase (flat) price of the bond? b. What is the accrued interest? c. What is the quoted price of the bond? d. What is the quoted price as a percentage of face value?
s
Determine the price of a $1.3 million bond issue under each of the following independent assumptions: 1. Maturity 10 years, interest paid annually, stated rate 8%, effective (market) rate 10%. 2. Maturity 10 years, interest paid semiannually, stated rate 8%, effective (market) rate 10%. 3. Maturity 10 years, interest paid semiannually, stated rate 10%, effective (market) rate 8%. 4. Maturity 20 years, interest paid semiannually, stated rate 10%, effective (market) rate 8%. 5. Maturity 20 years, interest paid semiannually, stated rate 10%, effective (market) rate 10%. Note: Use tables, Excel, or a financial calculator. (FV of S1. PV of $1. EVA of $1. PVA of $1. EVAD of $1 and PVAD of $1.) Complete this question by entering your answers in the tabs below. Required 1 Required 3 Required 2 Required 4 Required 5 Maturity 10 years, interest paid annually, stated rate 8%, effective (market) rate 10%. Note: Round your answer to the nearest whole dollar. Price of bonds Required 2 > Next
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