What would you pay for a $180,000 debenture bond that matures in 15 years and pays $9,000 a year in interest if you wanted to earn a yield of: Click here to view factor tables. (a) 2%? (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places e g 458 581)

Q: A $5,000 bond with a bond rate of 5% payable semi-annually was purchased for $4,500, kept for 10…

A: The above answer can be explained as under - Here, the excel has been used to calculate yield to…

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A: Issue price of the bonds = Present value of principal + Present value of interest payments where,…

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Q: What would you pay for a $205,000 debenture bond that matures in 15 years and pays $10,250 a year in…

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A: Given:

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Treasury Market

On-the-run securities are the most recently issued securities in the market depth and are therefore traded at some premium. The off-the-run securities are the ones issued just before the most recent ones. The on-the-run securities have a lower yield to the investor than the off-the-run securities.