What is the return on a bond that was issued at 9% coupon rate, 10% YTM, forfive years, Face value of $1000 if YTM changed from 10% to 12% after the receiptof the first coupon and the bond was sold (the bond was sold at the beginning ofthe second year? A) 11, 50% B. 6, 98% C. 8,23 % D. 11,00%

Answered: What is the return on a bond that was…

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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A bond has a 12% coupon rate. The coupon is paid semi-annually and the last coupon was paid 79 days ago. If the bond has a par value of $1,000, what is the accrued interest (assume a 364 day year)? Group of answer choices A. $20.44 B. $23.65 C. $26.04 D. $16.69 E. $22.49
Suppose an Exxon Corporation bond will pay $1,000 ten years from now. If the going interest rate on safe 10-year bonds is 7.00%, how much is the bond worth today? O a. $483.98 b. $475.09 Oc. $508.35 Od. $502.57 O e. $543.93
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A corporate bond has 23 years to maturity, a face value of $1,000, a coupon rate of 5.5%, and pays interest semiannually. The annual market interest rate for similar bonds is 3.3%. Part 1 What is the value of the bond? 0+ decimals
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A bond has the following terms: Principal amount $1,000 Semi-annual interest $45 Maturity 15 years a. What is the bond's price if comparable debt yields 11%? b. What would be the price if comparable debt yields 11% and the bond matures after ten years? c. What would be the bond's price in a. and b. if interest rates declined to 8 % ?

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What is the return on a bond that was issued at 9% coupon rate, 10% YTM, for five years, Face value of $1000 if YTM changed from 10% to 12% after the receipt of the first coupon and the bond was sold (the bond was sold at the beginning of the second year? A) 11, 50% B. 6, 98% C. 8,23 % D. 11,00%