In November 2017, Treasury 3 1/8s of 2039 offered a semiannually compounded yield to maturity of 2.96%. Recognizing that couponsare paid semiannually, calculate the bond's price. Assume face value is $1,000. (Do not round intermediate calculations. Round youranswer to 2 decimal places.)Bond price

Bond price is calculated by discounting all the coupon payments and terminal value of the bond by…

Answered: In November 2017, Treasury 3 1/8s of…

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

See similar textbooks

Similar questions

Assume that today's date is February 15, 2015. Robin Hood Inc. bond is an annual-coupon bond. Par value of the bond is $1,000. How much you will pay for the bond if you purchased the bond today? The answer should be calculated to two decimal places Company Price Robin Hood 88.401 Your Answer: Answer Coupon Rate 6.148 Maturity Date 2-15-2034 YTM Current Yield Rating D
A $15,000 bond with a coupon rate of 4% compounded semi-annually is redeeemable on February 1, 2024. It was purchased on June 13, 2018 when the yield rate was 5% compounded semi-annually. What is the purchase price of the bond?
h
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
A 6% coupon rate, semiannual pay corporate bond was priced for settlement on April 28, 2015 and matures on November 15, 2034. The bond’s yield to maturity was 5.00%, its quoted price was 112.3798 and the accrued interest was 2.7167. If its yield were to decline 5 basis points to 4.95%, the bond’s quoted price would rise to 113.0529, and if its yield were to increase 5 basis points to 5.05%the quoted price would fall to 111.7121. The bonds’ annual approximate modified duration was closest to: 12.53 12.23 11.93 11.65
In January 2019, Cannon announced the issuance of a $1.2 billion bond. The bonds have a coupon rate of 6.0% payable semiannually. Assume the bonds have been assigned credit ratings of BBB (stable outlook) by Standard and Poor's, Baa2 (stable outlook) by Moody's, and BBB (stable outlook) by Fitch. Which of the following is true? Choose all that are correct. The coupon rate on these bonds would have been higher if Standard and Poor's, Moody's, and Fitch had assigned lower credit ratings. The periodic interest payment will be $36 million. The yield on these bonds would have been lower if Standard and Poor's, Moody's, and Fitch had assigned higher credit ratings. The periodic interest expense will depend on the bond's coupon rate.
On September 27, 2015, Koala, Inc. issued a 10 year bond (with a typical $1,000 face value) that had an annual coupon value of $65. [We are assuming that the 2021 coupon has just been redeemed.] Initially, the bond was sold at a discount price of $978. • On September 27, 2021, this bond was selling at a premium for $1,010. • The market rate of interest for a riskless corporate bond, of this maturity (i.e., a Treasury security), was 2.8% on September 27, 2015, which reflects market expectations about future rates of inflation. • The market rate of interest for a riskless corporate bond, of this maturity (i.e., a Treasury security), was 1.9% on September 27, 2021, which reflects market expectations about future rates of inflation. 1. What was the nominal yield on this bond on September 27, 2015? [To 1 decimal place.] 2. What was the current yield on this bond on September 27, 2015? [To 3 decimal places.] 3. What was the yield to maturity for this bond on September 27, 2015? [To 2 decimal…
A bond that has a face value of $1,500 and coupon rate of 3.20% payable semi-annually was redeemable on July 1, 2021. Calculate the purchase price of the bond on February 10, 2015 when the yield was 3.70% compounded semi-annually. $0.00
Consider a zero-coupon bond issued on 1st of March 2017 with maturity in two years and face value £100 (a) Compute the price on the 1st of March 2017 if the gross yield is 4% p.a. effective. (b) If the bond is issued at a price of £90 and pays capital gains tax at 25%, find the net redemption yield.
A bond that has a face value of $2,500 and coupon rate of 2.50% payable semi-annually was redeemable on July 1, 2021. Calculate the purchase price of the bond on February 10, 2015 when the yield was 2.75% compounded semi-annually. $0.00 Round to the nearest cent
9. A $20,000, 10% bond with semi-annual coupons redeemable at par March 1, 2021, was purchased on November 15, 2014, to yield 9% compounded semi-annually. What was the purchase price of the bond? please use TI BAII calculator
A bond that settles on June 7, 2022, matures on July 1, 2042, and may be called at any time after July 1, 2032, at a price of 180. The coupon rate on the bond is 6.4 percent and the price is 196.00. What are the yield to maturity and yield to call on this bond? Note: Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS