QUESTION 3 Consider a 6.5%-coupon (semi-annual) bond with 9 years until maturity. If the price of the bond is $139.90, what is the yield-to-maturity of the bond? State your answer as a percentage; e.g. if the answer is 5.00%, write 5.00 rather than 0500. QUESTION 4 What is the yield-to-maturity of a 7-year, 5%-coupon bond with a price of $93.00? Assume the bond has a par value of $100 and pays coupons semi-annually. State your answer as a percentage; e.g. if the answer is 5.00%, write 5.00 rather than .0500.

QUESTION 3 Consider a 6.5%-coupon (semi-annual) bond with 9 years until maturity. If the price of the bond is $139.90, what is the yield-to-maturity of the bond? State your answer as a percentage; e.g. if the answer is 5.00%, write 5.00 rather than 0500. QUESTION 4 What is the yield-to-maturity of a 7-year, 5%-coupon bond with a price of $93.00? Assume the bond has a par value of $100 and pays coupons semi-annually. State your answer as a percentage; e.g. if the answer is 5.00%, write 5.00 rather than .0500.

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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Consider a bond that is currently priced at $1100. If the face value of the bond is $1000, coupon payments are made semiannually, the bond matures in 5 years, and the YTM is 3%, what is the coupon rate? Group of answer choices 5.17% 2.58% 3.00% $25.84
A zero-coupon bond with face value $1,000 and maturity of five years sells for $741.22. a. What is its yield to maturity? (Round your answer to 2 decimal places.) Yield to maturity % b. What will the yield to maturity be if the price falls to $725? (Round your answer to 2 decimal places.) Yield to maturity %
An investor wants to find the duration of a(n) 15-year, 6% semiannual pay, noncallable bond that's currently priced in the market at $587.05, to yield 12%. Using a 150 basis point change in yield, find the effective duration of this bond (Hint: use Equation 11.11). Question content area bottom Part 1 The new price of the bond if the market interest rate decreases by 150 basis points (or 1.5%) is $enter your response here. (Round to the nearest cent.)
K Assume that a bond will make payments every six months as shown on the following timeline (using six-month periods): Period 0 2 Cash Flows $19.12 $19.12 a. What is the maturity of the bond (in years)? b. What is the coupon rate (as a percentage)? c. What is the face value? a. What is the maturity of the bond (in years)? The maturity is years. (Round to the nearest integer.) 39 $19.12
D Bond P is a premium bond with a 9 percent coupon. Bond D is a 4 percent coupon bond currently selling at a discount. Both bonds make annual payments, have a YTM of 6 percent, and have four years to maturity. What is the current yield for Bond P and Bond D? (Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16)) Bond P Bond Current yield 8.15% 4.30 % If interest rates remain unchanged, what is the expected capital gains yield over the next year for Bond P and Bond D? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16))) Bond P Bond D Capital gains yield -2.15 % 1.70 %
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1
Consider the following par bond (ie coupon rate=yield):Maturity: 1 2 3 4 5YTM: 5%; 4.5%; 4%; 3.5%; 3.2% Q4. Price a 5 year 2% coupon bond. What is the YTM for the bond
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Need help with C Approximate yield to maturity An investor must choose between two bonds: Bond A pays $90 annual interest and has a market value of $815. It has 15 years to maturity. Bond B pays $81 annual interest and has a market value of $700. It has eight years to maturity. Assume the par value of the bonds is $1,000. a. Compute the current yield on both bonds. (Do not round intermediate calculations. Input your answers as a percent rounded to 2 decimal places.) Current Yield Bond A11.04% Bond B11.57% c. A drawback of current yield is that it does not consider the total life of the bond. For example, the approximate yield to maturity on Bond A is 11.51 percent. What is the approximate yield to maturity on Bond B? The exact yield to maturity? (Use the approximation formula to compute the approximate yield to maturity and use the calculator method to compute the exact yield to maturity. Do not round intermediate calculations. Input your answers as a percent rounded to 2…

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