Q8- What is the current price of bond paying an 12% annual coupon, and a face value of $10,000 with 9 years to maturity if discount rate is 9%. Select one: А. $11,798.57 В. $13,798.57 С. $10,798.57 D. $12,798.57 Е. $14,798.57

Q8- What is the current price of bond paying an 12% annual coupon, and a face value of $10,000 with 9 years to maturity if discount rate is 9%. Select one: А. $11,798.57 В. $13,798.57 С. $10,798.57 D. $12,798.57 Е. $14,798.57

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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Question

Q8- What is the current price of bond paying an 12%
annual coupon, and a face value of $10,000 with 9
years to maturity if discount rate is 9%.
Select one:
A.
$11,798.57
В.
$13,798.57
C.
$10,798.57
D.
$12,798.57
Е.
$14,798.57

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470 -37 Assume that the dividend payout ratio will be 55 % when the rate on long term government bonds falls to 9%. Since investors are becoming more risk averse, the equity risk premium will rise to 8% and investors will require a 7% return. The return on equity will be 13%. What is your expectation of the market P/E ration? a. 37.69 b. 24.92 c. 58.15 d. 55.02 e. 47.82
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7A-5 ZEROS AND EXPECTATIONS THEORY A 2-year, zero coupon Treasury bond with a maturity value of $1,000 has a price of $873.4387. A 1-year, zero coupon Treasury bond with a maturity w w m w w h w w wwww value of $1,000 has a price of $938.9671. If the pure expectations w ww theory is correct, for what price should 1-year, zero coupon Treasury bonds sell 1 Year from now?
2:37 Vo) 1 LTE2 ا... 46 ... 22 ] (Related to Checkpoint 9.2) (Yield to maturity) The Saleemi Corporation's $1,000 bonds pay 6 percent interest annually and have 12 years until maturity. You can purchase the bond for $1,055. a. What is the yield to maturity on this bond? b. Should you purchase the bond if the yield to maturity on a comparable-risk bond is 4 percent? ||| a. The yield to maturity on the Saleemi bonds is %. (Round to two decimal places.) = O 41%

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