The table provides the prices of 5 zero-coupon bonds: Maturity Price per 100 of par 1 97.065 2 89.625 3 81.0832 4 74.7339 5 64.7391 Determine the value of the annual effective forward rate applicable from time 1 to time 2.
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- Consider information on the following bonds (with face value 100): Bond Maturity (years) Coupon rate Yield-to-maturity А 1 0% 5.0% В 2 5% 5.5% C 3 6% 6.0% Coupons are paid annually. What is the three-year spot interest rate?The following table gives the prices of Treasury bonds: Bond Principal ($) Time to maturity (years) Annual Coupon* ($) Bond Price ($) 100 0.50 100 1.00 100 1.50 100 2.00 0.0 0.0 6.2 8.0 98 95 101 104 A. Calculate zero rates for maturities of 6 months, 12 months, 18 months, and 24 months. B. What are the forward rates for the periods: 6 months to 12 months, 12 months to 18 months, 18 months to 24 months? C. What are the 6-month, 12-month, 18-month, and 24-month par yields for bonds that provide semiannual coupon payments? D. Estimate the price and yield of a two-year bond providing a semiannual coupon of 7% per annum. PLEASE SHOW EXCEL WORKThebond shown in the following table pays interest annually. Par value Coupon interest rate Years to maturity Current value $1,000 8% 9 $700 a. Calculate the yield to maturity (YTM) for the bond. b. What relationship exists between the coupon interest rate and yield to maturity and the par value and market value of a bond? Explain.
- c) Suppose you observe the following three bonds. Assume that all bonds are denominated at $100 face value per contract and that they pay their coupons annually. Price Coupon Maturity (years) Bond A 111.42 15 3 Bond B 108.33 15 Bond C 116.61 15 1 i) Compute the spot rates r0,1, r0,2 and r0,3. ii) Compute the forward rates r1,2 and r2,3.numerical answers should be calculated to at least two decimal places. Face value of bonds is taken as $100. assume coupon payments are paid once a year. Bond A: term to maturity=10 years, coupon rate = 9.75%, current price = $160.55. Find the current yield and yield to maturity of Bond A. Bond B: term to maturity-5 years, coupon rate = 11.25%, yield to maturity -2.35% p.a. Find the current price of Bond B. From your answer, what do say about this price when compared with the face value of the bond?What is the coupon payment for the bond in the table? Assume semi-annual payments. Bond Coupon Rate Yield Price Years to maturity Apple B ? 4.9% $921.72 28
- Vhat is the yield of each of the following bonds, if interest (coupon) is paid semiannually? 6% 20 8.02 % 5800.00 d of the following bond if interest (coupon) is 1 Data Table - X Years to Coupon Rate Matunty 12% 10 (Click on the following icon n in order to copy its contents into a spreadsheet.) eld of the following bond if interest (coupon) is Par Value $1,000.00 Yield to Maturity Matunty Doupon Rale 6% Price $800.00 $1,000.00 S3.110.00 $1.130.00 క Noturty 20 10 Coupon ato $1.000.00 12% 7% 20 $5,000.00 $1.000.00 7% 20 8% yield of the following bond if interest (coupon) is Yoars to Coupon Hate Print Done Maturity 00 8%Using the table below, Compute the convexity measure (in years) for bond 2 Bond 1 Bond 2 Coupon Yield to maturity Maturity (in years) Par value 6% 7% 6% 6% 4 $100 $100 $100 $108 Price O A. 14.763 12.652 OC. 13.312 OD. 13.927The following table summarizes prices of various default-free zero-coupon bonds (expressed as a percentage of the face value): a. Compute the yield to maturity for each bond. b. Plot the zero-coupon yield curve (for the first five years). c. Is the yield curve upward sloping, downward sloping, or flat? a. Compute the yield to maturity for each bond. The yield on the 1-year bond is 3.92 %. (Round to two decimal places.) Data table (Click on the following icon in order to copy its contents into a spreadsheet.) Maturity (years) Price (per $100 face value) 1 $95.51 2 3 $91.10 $86.55 $81.69 $76.45 Print Donday
- d of each of the following bonds, if interest (coupon) is paid quarterly? g bond if interest (coupon) is paid auarterv? (Round to two decimal places) - X Years to i Data Table tate Maturity 10 (Click on the following icon in order to copy its contents into a spreadsheet.) wing bond if interest (coupon) is Years to Maturity Yiekd to Maturity Price Maturly 10 Par Value Coupon ale n Rate $3,740.00 6% 8% 5% 7% $5,000.00 3% 20 $5,000,00 $1,000.00 $5.000.00 20 30 25 55,000.00 $800.00 $4.900 00 lowing bond if interest (coupon) is Years to Matuity on Rate Print Done 5% 30Use excelA bond that pays interest semiannually has a price of $981.73 and a semiannual coupon payment of $27.75. If the par value is $1,000, what is the current yield?