Google CEO Sundar Pichai purchased a bond that has 5% coupon with 4 yrs remaining maturity for $102. Face value is 100. Couponis paid on a semiannual basis. The bond is callable in 2 yrs and onward. The strike prices (call schedule) are given next: 101.5 (yr 2),101 (yr 3), and 100 (yr 4). Which of the following is most likely to be the bond's annual yield to maturity?A. 2.22%B. 4.45%C. 6.66%

Yield to maturity can be calculated using RATE function in Excel. As the bond pays semiannual…

Answered: Google CEO Sundar Pichai purchased a…

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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A bond has $ 94000 face value and the coupon rate of the bond is 3.4 % (APR). The YTM of the bond is 6.8 %. What is the fair price of the bond assuming that the maturity of the bond is 8 years and the bond pays coupon in every 6 months? (Give the answer in round numbers without presenting a $sign.) Answer: Time left 0:06:54 Next page
BVA, Inc. has two bond issues outstanding, each with a par value of $1,000. Information about each is listed below. Suppose market interest rates rise 1 percentage point across the yield curve. What will be the change in price for each of the bonds? Does this tell us anything about the relationship between initial yield to maturity and interest rate risk? Bond A: 12 years to maturity, pays a 7 percent coupon, and the market interest rate on this BB-rated bond is 12.36 percent. Bond B: 12 years to maturity, pays a 7 percent coupon, and the market interest rate on this A-rated bond is 10.25 percent. Kindly providethe excel solution
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Assume that today's date is August 15, 2015 and that the Kroger Bond is a semiannual-coupon bond with 1000 USD of Face value. Look at the table below with information about Kroger Bond and fill in the missed number with question mark: Type Issue date Price Coupon rate Maturity date YTM Current Yield Rating Bond Feb-2000 ??? 7.50% 2/15/2030 4.95% ??? AAA
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XYZ pty Ltd is considering investing in one of two outstanding bonds. The bonds offer 11% coupon interest rates and pay annual interest. Bond A has exactly 5 years to maturity and bond B has 15 years to maturity. You are appointed to evaluate the bond. Calculate the value of bond A and B if the required return (YTM) is 9% A. R1077.79 & R1261.21 Respectively B. R1177.79 & R1161.21 Respectively C. R1 077.79 & R1 161.21 Respectively D. R1095 & R1161.21 Respectively
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