It is 2018 and Charles is thinking about buying an Australian Treasury bond with a coupon rate of j2 3.17% p.a. and a face value of $100. The maturity date of the bond is 15 May 2033. If Charles purchased this bond on 5 May 2018, what was his purchase price (rounded to four decimal places )? Assume a purchase yield of j2 = 4.48% p.a. a. $87.62. b. $87.2829 c. $85.6981 d. $87.2812

It is 2018 and Charles is thinking about buying an Australian Treasury bond with a coupon rate of j2 3.17% p.a. and a face value of $100. The maturity date of the bond is 15 May 2033. If Charles purchased this bond on 5 May 2018, what was his purchase price (rounded to four decimal places )? Assume a purchase yield of j2 = 4.48% p.a. a. $87.62. b. $87.2829 c. $85.6981 d. $87.2812

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

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
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
Today is January 2, 2022, and investors expect the annual nominal risk-free interest rates in 2022 through 2024 to be: Year One-Year Rate (rRF) 2022 2.5 % 2023 2.3 2024 3.3 Assume the bonds have no risks. What is the yield to maturity for Treasury bonds that mature at the end of 2023 (a two-year bond)? Round your answer to one decimal place. % What is the yield to maturity for Treasury bonds that mature at the end of 2024 (a three-year bond)? Round your answer to one decimal place. %
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
Heidi is contemplating investing in an Australian Treasury bond. It is 2018, and the bond she is considering has a coupon rate of j2 = 1.36% p.a. and a face value of $100. The maturity date of the bond is 15 May 2033. Ultimately Heidi purchased this bond on 2 May 2018. What was her purchase price (rounded to four decimal places)? Assume a purchase yield of j2 = 3.31% p.a. a. 78.27 b. 77.6809 c. 77.6794 d. 77.0002
2 Refer back to the Series EE savings bonds we discussed at the very beginning of the chapter. a. Assuming you purchased a $50 face value bond, what is the exact rate of return you would earn if you held the bond for 20 years until it doubled in value? b. If you purchased a $50 face value bond in 2019 at the then current interest rate of .10 percent per year, how much would the bond be worth in 2029? c. In 2029, instead of cashing the bond in for its then current value, you decide to hold the bond until it doubles in face value in 2039. What rate of return will you earn over the last 10 years? Input area: a. Original value Number of years Future value b. Interest rate Number of years c. Number of years Output area: $50 a. Rate of return b. Future value C. Rate of return 20 (Use cells A6 to C11 from the given information to complete this question. Your answer for part b should be a positive value.) $100 0.10% 10
Determine the annualised return, including all its components, from the following bond transaction: a. on 27 April 2023 you purchase $12.35m face value bond maturing on 11 May 2030 which has a 2.70% coupon that is trading at a yield of 3.025% b. You sell this bond on 16 May 2023 at a yield of 3.195% (Please show all every steps in detail including formula used)
An investor uses £150,000 to buy 6-year bonds with a face value of £100. The bonds pay coupons semi-annually at a rate of 8%. The bonds currently yield 10% p.a. effective in the market. Calculate the price of a single bond £ 92.14 Enter your answer as a decimal correct to 2 decimal places Calculate the net present value of the bond investment project at an interest rate of 6.5% p.a. £ 数字 Enter your answer correct to £100
I need the answer as soon as possible
Herry is planning to purchase a Treasury bond with a coupon rate of 2.67% and face value of $100. The maturity date of the bond is 15 March 2033. (d) If Henry purchased this bond on 7 March 2020, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 3.31% p.a. compounded half-yearly. Henry needs to pay 27.8% on coupon payment and capital gain as tax payment. Assume that all tax payments are delayed by half year. Question 4Answer a. 83.6029 b. 68.6929 c. 82.4233 d. 94.5242