Today is 1 July 2021. Joan has a portfolio which consists of two different types of financial instruments (henceforth referred to as instrument A and instrument B). Joan purchased all instruments on 1 July 2017 to create this portfolio and this portfolio is composed of 385 units of instrument A and 334 units of instrument B. • Instrument A is a zero-coupon bond with a face value of 100. This bond matures at par. The maturity date is 1 January 2030. • Instrument B is a Treasury bond with a coupon rate of j₂ = 2.99% p.a. and face value of 100. This bond matures at par. The maturity date is 1 January 2024. (c) What is the current duration of instrument B? Express your answer in terms of years and round your answer to three decimal places. Assume the yield rate is j₂ = 4.07% p.a. a. 2.890 O b. 4.853 ○ c. 2.426 ○ d. 5.779

Today is 1 July 2021. Joan has a portfolio which consists of two different types of financial instruments (henceforth referred to as instrument A and instrument B). Joan purchased all instruments on 1 July 2017 to create this portfolio and this portfolio is composed of 385 units of instrument A and 334 units of instrument B. • Instrument A is a zero-coupon bond with a face value of 100. This bond matures at par. The maturity date is 1 January 2030. • Instrument B is a Treasury bond with a coupon rate of j₂ = 2.99% p.a. and face value of 100. This bond matures at par. The maturity date is 1 January 2024. (c) What is the current duration of instrument B? Express your answer in terms of years and round your answer to three decimal places. Assume the yield rate is j₂ = 4.07% p.a. a. 2.890 O b. 4.853 ○ c. 2.426 ○ d. 5.779

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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Today is 1 July, 2019. Siobhán has a portfolio which consists of two different types of financial instruments (henceforth referred to as instrument A and instrument B). Siobhán purchased all instruments on 1 July 2012 to create this portfolio, which is composed of 34 units of instrument A and 28 units of instrument B. • Instrument A is a zero-coupon bond with a face value of $100. This bond matures at par. Its maturity date is 1 January 2029. • Instrument B is a Treasury bond with a coupon rate of J₂=4.18% p.a. and a face value of $100. This bond matures at par. Its maturity date is 1 January 2022. Calculate the current duration of Siobhán's portfolio using a yield to maturity of j₂=4.52% p.a. Express your answer in terms of years and round your answer to two decimal places. O a. 5.23 years b. 7.00 years O c. 5.56 years O d. 6.49 years
Today is 1 July, 2022, Georg plans to purchase a corporate bond with a coupon rate of j2 = 1.8% p.a. and a face value of $100. This corporate bond matures at par. Its maturity date is 1 January, 2025. The yield rate is assumed to be j2 = 11.9% p.a. Assume that this corporate bond has a 5% chance of default in any six-month period during its term. Assume, also, that, if default occurs, Georg will receive no further payments at all. Calculate Georg's purchase price. Round your answer to three decimal places. O a. O b. $79.790 O c. $61.241 O d. $55.718 a. $78.509
An investor holds a Ford bond with a face value of $5000, a coupon rate of 7.5%, and semiannual payments that matures on 01/15/2029. How much will the investor receive on 01/15/20292 A. $5.000.00 OB. $2.503.75 OC. $5,375.00 OD. $5,187.50
You bought a newly issued 10-year, $1,000 par value, 5.50% coupon bond (with semiannual coupon payments) on May 1, 2023. You decided to check the value and yields on the bond annually, so that you can keep track of your wealth. Your first check was to be done on May 1, 2024. On April 15, 2024, the yield to maturity for the bond changed to 5.20%. For your one year anniversary of owning the bond, calculate the bond's total yield for the first year of ownership. Report the percentage to two decimal places (3.126% = 3.13).
Today is 1 July 2021. Joan has a portfolio which consists of two different types of financial instruments (henceforth referred to as instrument A and instrument B). Joan purchased all instruments on 1 July 2017 to create this portfolio and this portfolio is composed of 385 units of instrument A and 334 units of instrument B. • Instrument A is a zero-coupon bond with a face value of 100. This bond matures at par. The maturity date is 1 January 2030. • Instrument B is a Treasury bond with a coupon rate of j₂ = 2.99% p.a. and face value of 100. This bond matures at par. The maturity date is 1 January 2024. (a) Calculate the current price of instrument A per $100 face value (today's value). Round your answer to four decimal places. Assume the yield rate is j₂ =4.07% p.a. a. 60.4325 b. 50.7535 O c. 59.2273 O d. 71.0009
Please help me. Thankyou.
a. Today is 1 July, 2019. Latha has a portfolio which consists of two different types of financial instruments (henceforth referred to as instrument A and instrument B). Latha purchased all instruments on 1 July 2013 to create this portfolio, which is composed of 35 units of instrument A and 21 units of instrument B. Question 8Answer b. • Instrument A is a zero-coupon bond with a face value of $100. This bond matures at par. Its maturity date is 1 January 2029. • Instrument B is a Treasury bond with a coupon rate of j2 = 4.87% p.a. and a face value of $100. This bond matures at par. Its maturity date is 1 January 2022. Calculate the current price of instrument B per $100 face value. Round your answer to four decimal places. Assume the yield rate is /2 = 3.25% p.a. and Hélène has just received her coupon payment. $106.2948 d. $104.5951 $103.8598 $113.1500
It is 2018 and Ritchie is thinking about buying an Australian Treasury bond with a coupon rate of j2 = 2.05% p.a. and a face value of $100. The maturity date of the bond is 15 May 2033. If Ritchie purchased this bond on 7 May 2018, what was his purchase price (rounded to four decimal places)? Assume a purchase yield of j2 = 2.31% p.a. Question 9Answer a. $96.6707 b. $97.6960 c. $97.6952 d. $97.79
Today is 1 July, 2019. Siobhán has a portfolio which consists of two different types of financial instruments (henceforth referred to as instrument A and instrument B). Siobhán purchased all instruments on 1 July 2013 to create this portfolio, which is composed of 21 units of instrument A and 41 units of instrument B. • Instrument A is a zero-coupon bond with a face value of $100. This bond matures at par. Its maturity date is 1 January 2029. • Instrument B is a Treasury bond with a coupon rate of J2=4.05% p.a. and a face value of $100. This bond matures at par. Its maturity date is 1 January 2022. Calculate the current duration of Siobhán's portfolio using a yield to maturity of j2=4.6% p.a. Express your answer in terms of years and round your answer to two decimal places. a. 5.73 years O b. 4.19 years O c. 4.17 years O d. 6.38 years
Today is 1 July, 2019. Katrina has a portfolio which consists of two different types of financial instruments (henceforth referred to as instrument A and instrument B). Katrina purchased all instruments on 1 July 2011 to create this portfolio, which is composed of 28 units of instrument A and 44 units of instrument B. • Instrument A is a zero-coupon bond with a face value of $100. This bond matures at par. Its maturity date is 1 January 2029. • Instrument B is a Treasury bond with a coupon rate of j2 = 2.16% p.a. and a face value of $100. This bond matures at par. Its maturity date is 1 January 2022. Calculate the current price of instrument A per $100 face value. Round your answer to four decimal places. Assume the yield rate is j2 = 4.03% p.a. O a. $47.2049 O b. $48.7635 O c. $49.7461 O d. $68.4516
On February 9, 2015, Hunter-Gratzner, Inc. issued a 10 year bond (with a typical $1000 face value) that had an annual coupon value of $42. We will assume that the 2022 coupon has just been redeemed. Initially (in 2015), the bond was sold at the premium price of $1,037. On February 9, 2022, this bond was selling for $972. The market rate of interest for a riskless corporate bond, of this maturity (i.e., a U.S. Treasury security), was 1.75% on February 9, 2015, which reflected market expectations about future rates of inflation. The market rate of interest for a riskless corporate bond, of this maturity (i.e., a U.S. Treasury security), was 2.05% on February 9, 2022, which reflects market expectations about future rates of inflation. Question: What was the yield to maturity for this bond on February 9, 2015? [To 2 decimal places.]
Today is 1 July, 2022, Georg plans to purchase a corporate bond with a coupon rate of 2 1.25% p.a. and a face value of $100. This corporate bond matures at par. Its maturity date is 1 January, 2025. WIThe yield rate is assumed to be 2 15.8% p.a., Assume that this corporate bond has a 8% chance of default in any six-month period during its term. Assume, also, that, if default occurs, Georg will receive no further payments at all. Calculate Georg's purchase price. Round your answer to three decimal places. a. S72.957 b. S70.676 C. $47.051 d. $40.650

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