What is the yield to maturity on a bond that has a price of $1,600 and pays $100 interest annually for 6 years at the end of which it repays the principal of $1000? Is the bond selling at premium, at par, or at discount? How can you tell?
Q: the current interest rate on bonds of a certain type is 10%, compounded semiannually, what should…
A: Market price of bond = Present value of all coupon payments +Present Value of face value We need to…
Q: What is the yield on a corporate bond with a $1000 face value purchased at a discount price of $925,…
A: Bond is a debt instrument issued by companies and government. It is a fixed income instrument which…
Q: ACT has an outstanding bond with a face value ( principal) of 1,000which would mature in 10 years.…
A: Current market value = present value of all future cash flows Here FV = 1000; nper (or time…
Q: calculate the present value
A: Present value (PV) is nothing but the present value of all future cash inflows from a bond. And we…
Q: Carrie's clothes, has a five year bond oustanding that pay $60 annually. The face value of each bond…
A: a.Calculation of Coupon Rate of Bond:
Q: A bond pays coupons annually, has a yield-to-maturity of 5%, and a duration of 6 years. What is this…
A: A financial instrument that doesn’t affect the ownership of the common shareholders or management of…
Q: What is the yield to maturity for a seven-year bond that pays 11% interest on a $1000 face value…
A: Calculation of yield to maturity (YTM): Excel spread sheet:
Q: Given a bond with face value $100 and with maturity in 4 years, that pays annual coupon of $28 in…
A: Bonds are interest-paying securities that are issued by a corporation or the government to raise…
Q: What is the market price of a $1,000, 8 percent bond if comparable market interest rates drop to 6…
A: Price of the bond is present value of future cashflows
Q: What is the yield on a corporate bond with a $1000 face value purchased at a discount price of $925,…
A: The annual income (interest or dividends) from an investment is divided by the current price of the…
Q: What is the yield on a corporate bond with a $1000 face value purchased at a discount price of $950,…
A: GIVEN, FACE VALUE = $1000 PRICE = $950 INTEREST RATE = 8%
Q: A one-year premium bond with a face value of $10,000 has been purchased for $11,150. What is the…
A: The following information has been provided in the question: Face value of bond= $10,000 Price of…
Q: A 30-year bond with a face value of $1,000 pays $35 every 6 months and has a yield to maturity of 4%…
A: Return rate which an investor can earn from holding the security for a particular time period is…
Q: A corporate bond has 18 years to maturity, a face value of $1,000, a coupon rate of 5.3% and pays…
A: Using excel PV function
Q: What is the present worth of a $10000 bond that has an interest of 20% per year payable…
A: The bond is fixed-income security issued by the company to raise funds. The present worth of a bond…
Q: ACT has an outstanding bond with a face value (principal) of Php. 1,000 which would mature in 10…
A: Bond Bonds have an annual coupon rate attached to themselves, which the bondholder receives each…
Q: What is the price of the bond at 3 different points in time - today, in 1 year, and in 2 years. Is…
A: Bond valuation refers to a method which is used to compute the current value or present value (PV)…
Q: What is the approximate yield to maturity for a seven-year bond that pays 11% interest on a $1000…
A: Using excel RATE function
Q: A bond with 18 years to maturity has an annual interest payment of $30. If the bond sells for its…
A: Consider the face value be $1000 So, price of bond = $1000
Q: What is the yield on a corporate bond with a $1000 face value purchased at a discount price of $950,…
A: given information face value = $1000 discount price = 950 interest rate = 6%
Q: what is the bond rate of return over the year?
A: Bond Rate of Return: It refers to the gain or loss of a security/investment for a certain period.…
Q: Assume a firm issues a bond with a face value of $1,000. The stated rate of interest is 20%. The…
A: A bond is a debt instrument that is used by organizations to gather capital for financing their…
Q: What is the market price of a $1,000, 8 percent bond if comparable market interest rates rise to 10…
A: Given, C = coupon payment = $80.00 (Par Value * Coupon Rate)n = number of years = 14r = market rate…
Q: A 7 year bond with maturity value of $5504.1 and a yield rate of 5% was sold 15 months before…
A: Maturity value of the bond = $5,504.10 Yield rate = 5.00% Number of years = 7 years Purchase value…
Q: Carrie's Clothes, Inc. has a six-year bond outstanding that pays $80 annually. The face value of…
A: Company issues bonds for the purpose of raising some funds and these are all considered to pay fixed…
Q: Consider the four bonds having annual payments as shown in the following table Year Bond A Bond B.…
A: A bond is a debt instrument by which capital is raised by an institution. It is different from a…
Q: the following features: • Coupon rate of interest (paid annually): 10 percent • Principal: $1,000 •…
A: Bond is a type of debt security which carry fixed income i.e. interest. Bond are issued by…
Q: The face value on a bond is $15,000. It has a 15-year maturity and a 3% coupon. What is the annual…
A: Annual Interest Paid to the Bondholder = Face Value * Coupon Rate
Q: The Saleemi Corporation's $1,000bonds pay 5 percent interest annually and have 13 years until…
A: A. Yield to maturity = [Interest +(Maturity value - Purchase Price)/number of years of…
Q: Assume that a bond makes 30 equal annual payments of \$1,000$1,000 starting one year from today.…
A: Using excel PV function
Q: Which of the following bonds is trading at a premium? O A. a ten – year bond with a $4,000 face…
A: A bond will trade at Premium, when Coupon rate is greater than YTM A bond will trade at discount ,…
Q: What would be the selling price of a 10-year bond with a face value of P100.000, interest at 20%…
A: The question is based on the concept of Financial management.
Q: A bond with 12 years to maturity has an annual interest payment of $65. If the bond sells for its…
A: Given information: Par value of bond is $1,000 Annual interest payment is $65 Number of years is 12
Q: The Saleemi Corporation's $1,000 bonds pay 5 percent interest annually and have 13 years until…
A: Bonds are long-term financing debt. It is a company that raises funds for its business. In return, a…
Q: The Saleemi Corporation's $1000 bonds pay 7 percent interest annually and have 14 years until…
A: Given, Face Value = $1000 Coupon rate = 7% Coupon payment = $1000*7% = $70 Current Price = $1095…
Q: What is the yield on a corporate bond with a $1000 face value purchased at a discount price of $850,…
A: The Current Yield is the investment annual income which is divided by the market price. It shows the…
Q: What is the yield to maturity for a bond paying $45 semi-annually that has twelve years until…
A: Given information : Coupon (Semi annually) = $45 Time to maturity = 12 years Selling price = $975
Q: What is the yield on a corporate bond with a $1000 Face value purchased at a discount Price of $850,…
A: Bonds are long-term financial debt for the company. Bonds help the company to raise funds and in…
Q: What is the value of a Northern Pacific bond with an 11 percent coupon, maturing in 15 years? Assume…
A: Using excel PV function
Q: The face value of a bond is $3000.00. The firm offering the bond pays 1% of the sales price to the…
A: Rate of return is one of the discounted cash flow techniques used by business entities in order to…
Q: What is the bond equivalent yield on a $1 million T-bill that currently sells at 91.320 percent of…
A: Bond Equivalent Yield refers to the annual percentage return earned by an investor on the prevailing…
Q: If the annual interest rate printed on the face of a bond is 10 percent, the face value of the bond…
A: Here, Annual Interest rate = 10% Face value of the bond =$1,000 Present value of the bond = $1,250…
Q: Consider a 12%, 15 year bond that pays interest semiannually, and its current price is $675. What is…
A: Yield to maturity is the rate of return a bondholder will get if receive promise future cash flows…
Q: What is the duration of a bond
A: Duration of a bond measures the volatility of price of a bond to the percentage change of the…
Q: A four-year discount bond has a face value of $1,000 and a price of $925. What is the yield to…
A: We need to use RATE function in excel in to calculate yield to maturity. Yield to maturity(YTM)…
Q: What is the approximate yield to maturity for a $1,000 par value bond selling for $1,120 that…
A: Yield to Maturity: The yield to maturity (YTM) of a bond is the overall rate of return that the bond…
Q: f a bond can be purchased for $60 and has a maturity value at the end of 10 years of $500, what is…
A: Bonds: Bonds are the liabilities of the company which is issued to raise the funds required to…
Q: A bond has the following terms: Principal amount $1,000 Semi-annual interest $45 Maturity 15…
A: BOND PRICE FORMULA: PRICE=P1+RN+INTEREST×1-11+RNR
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- A bond promises to pay $150 in one year. What is the interests rate on the bond if its price today is $65,$75 and $85?What is the yield to maturity on a bond that has a price of $1,700 and a coupon rate of 12% annually for 6 years at the end of which it repays the principal of $1000? Is the bond selling at premium, at par, or at discount? How can you tell? (Using financial calculator)Suppose you buy a one-year discount bond with a face value of $5,000 with a yield to maturity of 4%. What is the bond’s price?.
- Suppose the current interest rate on a one-year bond is 2% and the current interest rate on a two-year bond is 4%. The term premium on a two-year bond is 1%. According to the expectations hypothesis, what interest rate should we expect on a one-year bond next year? Answer as a percentage to one decimal place and do not include symbols (e.g. $, %, commas) in your answer. Answer:Suppose a bond with no expiration date has a face value of $10,000 and annually pays a fixed amount of interest of $750, calculate the interest rate that the bond would yield to a bond buyer. Show all work.Assume that a $10,000.00 bond paying 8.5% interest is currently selling at 106. a. What is the current selling price of the bond?b. What is the current yield of this bond?
- Assume a bond with a 10% annual rate has 8 years left to maturity when market rates are at 12%. Assume semi-annual payments. What is the price of the bond at 3 different points in time - today, in 1 year, and in 2 years. Is this a discount or premium bond, and what do you notice about the relationship between the price and maturity value (FV) over time?A bond with 18 years to maturity has an annual interest payment of $35. If the bond sells for its par value, what are the bond's current yield and yield to maturity? Round your answers to two decimal places. CY:______% YTM:_____%A 9-year bond has a yield of 13.5% and a duration of 8.63 years. If the MARKET yield changes by 60 basis points, what is the percentage change in the bond’s price? Is this an increase or decrease? A 9-year bond has a yield of 13.5% and a duration of 8.63 years. If the BOND'S yield changes by 60 basis points, what is the percentage change in the bond’s price? Is this an increase or decrease? ( Explain well both question with proper step by step Answer) .
- Assume that interest rate on a 182-day, $1 million face value, T-Bill is currently selling at a discount rate of 4.15%. What is the price of the T-Bill? What is the realized or holding period return of the bond?What is interest rate (or price) risk? Which bondhas more interest rate risk: an annual payment1-year bond or a 10-year bond? Why?The price of a bond with 4 years to maturity that pays interest of $12 Question 4. each half-year is $106. What is the current yield, the capital gains yield and the yield to maturity of this bond? What is the internal rate of return of this bond 100