Herry is planning to purchase a Treasury bond with a coupon rate of 2.63% and face value of $100. The maturity date of the bond is 15 March 2033. (d) If Henry purchased this bond on 6 March 2020, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 3.1% p.a. compounded half-yearly. Henry needs to pay 27.6% on coupon payment and capital gain as tax payment. Assume that all tax payments are delayed by half year. O a. 85.6867 O b. 70.0863 O c. 84.5168 O d. 96.2170

Herry is planning to purchase a Treasury bond with a coupon rate of 2.63% and face value of $100. The maturity date of the bond is 15 March 2033. (d) If Henry purchased this bond on 6 March 2020, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 3.1% p.a. compounded half-yearly. Henry needs to pay 27.6% on coupon payment and capital gain as tax payment. Assume that all tax payments are delayed by half year. O a. 85.6867 O b. 70.0863 O c. 84.5168 O d. 96.2170

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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Iolanda purchased a Treasury bond with a coupon rate of 4.08% p.a., compounded half-yearly, and face value of $100. The maturity date of the bond is 15 April 2029. a) Luciana plans to purchase Iolanda's Treasury bond on 11 April 2018. What price will Luciana pay (rounded to four decimal places)? Assume a yield of 4.72% p.a., payable half-yearly. a. 94.6997 b. 94.5572 c. 94.5088 d. 94.5068 (b) In fact, Luciana purchased Iolanda's bond on 9 February 2018. What was Luciana's purchase price (rounded to four decimal places)? Assume a yield of 4.72% p.a., payable half-yearly. a. 95.7915 b. 95.9769 c. 95.7959 d. 93.7728
Karl is planning to purchase a Treasury bond paying a (2) coupon rate of 3.86% p.a. The face value of the bond is $100. Its maturity date is 15 March 2033; the bond matures at par. If Karl purchased this bond on 4 March 2020, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 4.24% p.a., compounded half-yearly. Karl needs to pay 19.7% of coupon payments and capital gains in tax. Assume that all tax payments are delayed by a half- year. a. $89.0716 b. $87.3203 c. $79.1253 d. $98.0081
Kayla is considering an investment in either a bond or a financial instrument that has a return of 0.5% per quarter. The face value for the bond is $25,000 that matures in 15 years and has a bond rate of 7% paid monthly. What is the amount of the monthly payments received from the bond?
Henry is planning to purchase a Treasury bond with a coupon rate of 2.26% and face value of $100. The maturity date of the bond is 15 March 2033. (b) If Henry purchased this bond on 3 March 2020, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 3.11% p.a. compounded half-yearly. Henry needs to pay 28.2% on coupon payment as tax payment and tax are paid immediately. a. 84.9188 O b. 84.1098 c. 84.9203 ○ d. 85.4177
Angelo purchased a 7% annual coupon bond one year ago for $987. At the time of purchase, the bond had six years to maturity. Over the past year inflation has been 3.2%. The market required return on this bond today is 8%. If Angelo sells the bond today at the market price, what real rate of return will he realize on this investment? -1.16% 1.13% 4.36% 4.33% 1.17%
Iolanda purchased a Treasury bond with a coupon rate of 4.59% and face value of $100. The maturity date of the bond is 15 April 2029. (a) Luciana plans to purchase Iolanda's Treasury bond on 12 April 2018. What price will Luciana pay (rounded to four decimal places)? Assume a yield of 2.54% p.a. compounded half-yearly. a. 119.5663 b. 119.5414 c. 119.5404 d. 118.7648
Today is 1 July, 2022, Georg plans to purchase a corporate bond with a coupon rate of j2 = 1.69% p.a. and a face value of $100. This corporate bond matures at par. Its maturity date is 1 January, 2025. The yield rate is assumed to be j2 = 10.9% p.a. Assume that this corporate bond has a 6% chance of default in any six-month period during its term. Assume, also, that, if default occurs, Georg will receive no further payments at all. Calculate Georg's purchase price. Round your answer to three decimal places. Answer a. $59.319 b. $81.541 c. $80.092 d. $53.631
Pierre Dupont just received a cash gift from his grandfather. He plans to invest in a 5 year bond issued by Venice Corp. that pays an annual coupon rate of 5.5%. If the current market rate is 7.2%, what is the maximum amount Pierre should be willing to pay for this bond?
I need the answer as soon as possible
Susan can buy a zero-coupon bond that will pay 1,000 at the end of 12 years and is currently selling for 624.60. Instead, she purchases a bond with 6% semi-annual coupons that will pay 1,000 at the end of 10 years. If she pays X for this bond she will earn the same annual effective interest rate as the zero-coupon bond. Calculate X.
Kevin owns a bond that has a face value of $1,000, a remaining maturity of 8 years and a current market price of $1,056.50. If Kevin believes that his bond has a yield to maturity of 6.28%, then what must be the annual Coupon PMT of Kevin’s bond?
Assume that Jack Tan wishes to purchase a bond with a 10-year maturity, an annual coupon rate of 10%, a face value of RM1,000, and pay interest payments every six If Jack Tan requires a 12% nominal yield to maturity on this investment, compute the maximum price he should be willing to pay for the bond.

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