Suppose you bought a bond a year ago for $993.47. The bond has a price of $949.4 today. It just paid a coupon of $48.79. What was your total return (in percent) over the last year? Answer to two decimals

Q: A 3-month zero-coupon bond is selling for $99.7 and a 10-year zero-coupon bond is selling for $54.3.…

A: It is the case of calculation of spread in yields given by 3-month maturity bonds and 10 years…

Q: 8.4.21 You deposit $9000 in an account that pays 4.5% interest compounded quarterly. A. Find the…

A: Future value refers to the compounded value of future cash flows at an interest rate for a given…

Q: How much would be your total yield if you sell this bond today?

A: Price of the bond is the PV of all future coupons and par value discounted at the YTM. This bond is…

Q: Consider a bond with a principal of $1,000 that pays a coupon of $100 per year. If the bond matures…

A: Bond: It is a fixed income instrument that represents a loan made by an investor to a borrower. We…

Q: 3. An investor buys a 10 year, 3% coupon, ATT bond for $93. The par value is $100. What is the YTM…

A: Bond yield refers to the amount of return an investor can expect to earn on a bond investment if it…

Q: The rate of return earned on the bond during the year was _

A: Bond: It is one of the debt instruments issued by the firm to raise capital. The issuer pays the…

Q: ased on the prior information, what is the expected one-year rate for the second Copied: The…

A: Expectation theory predicts the short term interest rate based on the long term interest rate.

Q: You bought a 10-year US bullet bond for $990 with a coupon rate of 4.3%/year. A) Is the market rate…

A: A)  To determine whether the market rate is higher or lower than the bond's coupon rate of 4.3%, we…

Q: Using the expectations hypothesis theory for the term structure of interest rates, determine the…

A: Under the expectations hypothesis theory: Expected return for the 2-year security= Average expected…

Q: The Baron Basketball Company (BBC) earned $10 a share last year and paid a dividend of $6 a share.…

A: Value of the Stock = Present value of the future dividends + Present value of the terminal selling…

Q: Assume that you conduct a relative value trade and close it out after 5 days. Your 5-day return is…

A: Bond equivalent yield = return up till days to maturity * 365 days in a year /days to maturity

Q: Suppose a five-year, $1,000 bond with annual coupons the bond's coupon rate?

A: Bonds serve as an important source of financing for organizations and provide investors with a…

Q: You have purchased a 14 year $1000 per value bond. The annual coupon rate on the bond is 9.7% paid…

A: d. 802. 67Explanation:Step 1: Calculate the present value of the annuity (coupon payments) using the…

Q: Suppose that you purchased a Baa rated $ 1000 annual coupon bond with a 5% coupon rate and a 7-year…

A:

Q: s a list of prices for zero-coupon bonds with different maturities and par value of $1,000. Suppose…

A: According to expectation theory short term interest should based on long term interest and both…

Q: following information, compute the rate of return earned on the bond if the bond was sold on the…

A: Bonds are paid periodic payment of coupon and par value of Bond is paid on maturity of Bond. Bonds…

Q: Suppose the discount rate is 10%. You bought a 10-year, 8% coupon bond with 7 years after it is…

A: The coupon rate indicates the interest rate on the bound. The period payment is determined using the…

Q: You purchased a coupon bond one year ago. The bond makes annual interest payments at a coupon rate…

A: A bond refers to an instrument that is used to raise debt capital for the issuing company from…

Q: Suppose you bought a bond with an annual coupon rate of 7.6 percent one year ago for $840. The bond…

A: a. Total Dollar Return The total dollar return on the investment over the past year can be broken…

Q: You just bought a straight bond that matures in 8.5 years for $ 878.50. The bond has a 6% coupon…

A: The yield on the bond can be found by using the RATE function in the Excel sheet where the values…

Q: Une year ago, an investor purchased a 10-year 8% annual coupon bond at par of $1,000. Today (with 9…

A: As per the given information: Par value of bond = $1,000Maturity period = 9 yearsYield rate = 7.10%…

Q: One year ago, an investor purchased a 10-year 8% annual coupon bond at par of $1,000. Today (with 9…

A: When holding the bond there are profit possible one is the coupon payments and another is possible…

Q: Suppose you bought a bond last year for $12,000 with an annual coupon rate of 4%. This year,…

A: Present value of the Perpetual cash flows = Annual perpetual cash flow / Market rate of interestNote…

Q: You invested in a corporate bond that has a market price today of R1043.22 and a yield to maturity…

A: Solution:- Modified Duration measures the percentage change in price of bond (in the opposite…

Q: Suppose you buy a bond for $8,000 with a coupon rate of 4%. Next year, interest rates rise to 5%.…

A: Bond price today at an increased interest rate will be found by using the PV function in the Excel…

Q: compute total returns 1.       A Treasury bond with 5% coupon trades at $125 per $100 face value.…

A: Solution- Given that Rate=5% Traded at =$125 Face value=$100 Fhree month later traded at =$115…

Q: Suppose you purchase a 10-year bond with 6.3% annual coupons You hold the bond for four years and…

A: A bond has two types of cash flows One is from coupon payment which is regular interest payment from…

Q: During a period of severe inflation, a bond offered a nominal HPR of 87% per year. nflation rate was…

A: Real rate is the rate after considering the impact of inflation on interest rate.a) Real HPR =…

Q: Ganymedes earned on his bond investments a real rate of return of 5.93 percent for a time period…

A: Real rate of return = 5.93% or 0.0593Inflation rate = 12.42% or 0.1242We need to calculate the…

Q: Suppose you bought a bond with an annual coupon rate of 5.2 percent one vear ago for $920. The bond…

A: Given Information: Bond bought one year ago = $920 Bond sales value today = $970 Annual coupon rate…

Q: You are purchasing a 20-year bond that matures in 6 years. The bond has a par value of $5,000,…

A: Yield to Maturity shows the total returns earned from the security if kept till maturity. To…

Q: 4.   You bought a 10-year, 5% coupon bond for $1,000 and sold it 1 year later for $1,100. What is…

A: The holding period rate of return would be calculated by using the following formula:Rate of…

Q: Sioux Financial Corp. has forecasted its bond portfolio value for one year ahead to be P105 million.…

A: A bond is a liability on which a percentage of interest has to be paid till the maturity of the…

Q: Find the effective rate of the compound interest rate or investment. (Round your answer to two…

A: A = $80,000 P = $44035 t = 8 years

Q: The rate of return earned on the bond during the year was %. (Round your response to two decimal…

A: Bonds are fixed-income securities representing a loan made by an investor to a borrower, typically a…

Q: K Suppose a five-year, $1,000 bond with annual coupons has a price of $895.56 and a yield to…

A: Coupon rate is 3.894%Explanation:

Q: yield-to-maturity method

A: Five years ago you purchased an 8% coupon bond for $975. Today you sold the bond for $1,000. Use the…

Q: en the following information estimate the price of this corporate bond. Assume that the bond just…

A: Price of bond is the present value of coupon payments plus present value of par value of bond based…

Q: uppose you bought a 10 percent coupon bond one yea sells for $1,080 today. a. Assuming a $1,000 face…

A: Bonds are quite safe and secured investment but the return on bond are lower and bonds are paid…

Q: Assume that yields on U.S. Treasury securities were as follows:Term         Rate6 months…

A: a. Yield curve:

Q: Assume that you pay $815.36 for a long-term bond that carries a coupon of 7.7%. Over the course of…

A: Face value = $1,000Coupon rate = $7.7%Current bond price = $815.36Bond price in one year =…

Q: You bought one of Great White Shark Repellant Company's 8 percent coupon bonds one year ago for…

A: A bond is a debt instrument that allows the issuer to raise funds and obligates him to repay an…