SBM., issued a 5-year bond with a face value of P10,000 witha coupon rate of 9%. The bond can be redeemed at year 3 at101. Currently, the bond is quoted 95 2. The approximateyield to call would be closest to:a. 9.50%b. 3.67%c. 9.28%d. 10.27%e. 18.75%f. 11.03%SAM Co., issued a 10 year bond with a face value of P50,000with a coupon rate of 10% that will be paid semiannually. Thebond is callable at year 5 at 98. Currently the bond is quotedat 85. The approximate yield to call would be closest to:a. 8.31%b. 6.89%c. 13.77%d. 17.03%e. 1.71%f. 7.69%

Face value of bond = P 10000 Coupon rate = 9% Coupon amount = 10000*0.09 = P 900 Years to call = 3…

Answered: SBM., issued a 5-year bond with a face…

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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Broke Benjamin Co. has a bond outstanding that makes semiannual payments with a coupon rate of 5.5 percent. The bond sells for $938.52 and matures in 11 years. The par value is $1,000. What is the YTM of the bond? Multiple Choice 5.65% 6.28% 4.71% 5.97% 3.14%
4. A 5-year bond (denote this as Bond A) with semiannual coupons has a face value of $1,000 and a coupon rate of 6%. The bond is redeemable at 125% of the face value at maturity, and is currently selling for $1,015. Assume the next coupon is due six months from now. (a) Using linear interpolation with end points being 9% and 10%, approximate the bond's effective annual yield. (b) Another 5-year bond (denote this as Bond B) pays annual coupons and has the same face value, coupon rate, redemption value and yield as Bond A. Which bond has a larger duration? Explain your answer.
SAM Co., issued a 10 year bond with a face value of ₱50,000 with a coupon rate of 10% that will be paid semiannually. The bond is callable at year 5 at 98. Currently the bond is quoted at 85. Theapproximate yield to call would be closest to:a. 8.31% b. 6.89% c. 13.77%d. 17.03% e. 1.71% f. 7.69%
A 7% annual coupon bond has a maturity of three years and a yield to maturity on an annual basis of 8%. For the next two years, interest rates stay at 8% and thereafter they change to 7%. Which of the following is closest to the amount of reinvestment income on the bond to its final maturity if the par value of the holding is $1,000. A. $15.04B. $15.79C. $16.55
A 4-year bond, with a face value of $1000, and a coupon rate of 5% (coupon is paid semi-annually), has current yield of 4.76%. Is this bond sold at a discount, or at a premium? Determine the yield to maturity of this bond.
A company is trying to issue a 15-year, BB-rated, semi-annual paying bond with 6% annual coupon rate. If the appropriate annual discount rate for the bond issuance is 3% and the current credit risk premium for BB-rated bond is 3.5%, what is the current market price of this bond? $952.55 $852.25 $1011.36 $1213.25
The Sisyphean Company has a bond outstanding with a face value of $1,000 that reaches maturity in 15 years. The bond certificate indicates that the stated coupon rate for this bond is 9.5% and that the coupon payments are to be made semannually.Assuming the appropriate YTM on the Sisyphean bond is 7.4%, then this bond will trede at A a premium. B. par c. a discount. D. none of the above
For all questions, assume par value is R 1,000 and semiannual bond interest payments. b) ABSA has one outstanding bond issue with a coupon of 8% which will mature in 5 years. The bond now sells for R 1,141.69. What is the yield to maturity on this bond
SBM., issued a 5-year bond with a face value of ₱10,000 with a coupon rate of 9%. The bond can be redeemed at year 3 at 101. Currently, the bond is quoted 95 1⁄2. The approximate yield to call wouldbe closest to: a. 9.50% b. 3.67% c. 9.28%d. 10.27% e. 18.75% f. 11.03%
A $1,000 par value bond with a 7.50% coupon rate (semianual interest) matures in 7 years and currently sells for $992.66. What is the bond's yield to maturity and bond equivalent yield? The bond's yield to maturity is%. (Round to two decimal places.)
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 %
Ordinary bonds issued by PIMCO have a current quoted price of $830.50. The PIMCO bond has a 5.7% annual coupon rate. The YTM = 8.15% and the PIMCO bonds pays coupon twice per year. If the next coupon will be disbursed in exactly 6 months, the PIMCO bond will mature in: a. 5.19 years b. 29.14 years c. 19.96 years d. 20.77 years e. 10.39 years

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SBM., issued a 5-year bond with a face value of P10,000 with a coupon rate of 9%. The bond can be redeemed at year 3 at 101. Currently, the bond is quoted 95 2. The approximate yield to call would be closest to: a. 9.50% b. 3.67% c. 9.28% d. 10.27% e. 18.75% f. 11.03%