You hold an annual coupon bond for 1 year, receiving the 0.14 coupon before selling. When bought it had 6 years to maturity, and the YTM was 0.095. Over the year, interest rates ROSE by 0.002 What is the total holding period return for this investment? Group of answer choices 0.0939 0.0856 0.0903 0.0879 0.0820
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- You hold an annual coupon bond for 1 year, receiving the 0.14 coupon before selling. When bought it had 11 years to maturity, and the YTM was 0.08. Over the year, interest rates ROSE by 0.009 What is the total holding period return for this investment? 0.0276 0.0300 0.0291 0.0283 0.0267 [don't give chat gpt answer]K Assume that a bond will make payments every six months as shown on the following timeline (using six-month periods): 0 2 5 Period $19.53 a. What is the maturity of the bond (in years)? b. What is the coupon rate (as a percentage)? c. What is the face value? Cash Flows View an example Get more help. ★ a. What is the maturity of the bond (in years)? The maturity is years. (Round to the nearest integer.) A 6 1 MacBook Pro & 7 $19.53 * 8 9 C 59 $19.53 60 $19.53+$1,000 Clear all BUB 0 {What is the value of an Orion bond that has a 10 percent coupon, pays interest semiannually, and has 10 years to maturity, if the required rate of return is 12 percent? I $1,200 b. $885.50 c. $895.27 > b
- Consider a bond with a current value of $928.01. It is a 10-year, $1,000 bond, coupons paid semi-annually, and has a 7% coupon rate. a. The bond's yield to maturity (YTM) is: b. What will be its value (per $1,000 of face) if its YTM changes to 10%? Question content area bottom Part 1 a. The YTM is enter your response here%. (Round to two decimal places.) b. Value (per $1,000 of face): $enter your response here. (Round to the nearest cent.)How much should you pay for a 10 % annual coupon bond, with a $1,000 face value, which matures in 3 years? Assume a required return of 5%. A. $1136.16 B. $136.16 C. $863.84 D. $1000Question 1. Duration and Banking Consider a 5-year bond with annual coupon payments. The bond has a face value (prin- cipal) of $100 and sells for $95. Its coupon rate is 3%. (The coupon rate is the ratio between the coupon value and the face value). The face value is paid at the maturity year in addition to the last coupon payment. 1. Calculate the bond's yield to maturity (YTM) and duration using its YTM. 2. Suppose the bond's YTM changes in the same way as a 5-year T-bill interest rate. Use the bond's modified duration to evaluate the relative change in the 5-year bond's value if the interest rate on 5-year T-bills falls by one basis point, that is, by 0.0001. This part was extracted from the balance sheet of the First Bank of Australia: Assets (Billion AUD) Bond 80 Liabilities (Billion AUD) Fixed-rate liabilities 60 where "Bond" here refers to the bond we specified above and the fixed-rate liabilities (banks future payment obligations) have an average duration of 4 years and YTM of…
- aluation Sand L Sand S An investor has two bonds in his portfolio that have a face value of $1,000 and pay a 10%. annual. 1 Coupon. Bond I matures in 10 years while Bond 5 matures in 1 year. 1.1.9 a) What will the value of the Band L be if the going interest rate is 6%, 8%, and ||./.? doorbs Juon to bon 1.0 SUND 2900.0 8% 10 No tea Hou donosi 11 Y TMS 0 Glo zmarshalo) post? rastumo LV ada CUTOA 21 Rick good plasta DMX (space) 5/3QUESTION 15 Suppose that all investors expect that the interest rates for the 4 years will be as follows. What is the price of a 3-year zero coupon bond with par-$1,000? Year 1-Year Forward rate 4.6% 2 4.9% 3 5.2% 4 5.5% O a. $1,000.00 Ob. $866.32 Oc. $858.92 Od. $821.15Give typing answer with explanation and conclusion Consider two Bonds with $1,000 face value: 10-year and 30-year maturity. Both Bonds offer 10% annual coupon, paid once a year. Assume that interest rates, hence YTM (Yield to Maturity) changed from 4% to 5%. How much will be the percentage change in the 30-year Bond price? Enter your answer in the following format: + or - 0.1234 Hint: Answer is between -0.1175 and -0.1465
- Accounting Consider a bond with semiannual coupon payments of $50 and a principal payment of $1,000 in 10 years. Assume a flat yield curve with an 7% vied to maturity: If the yield curve remains unchanged, what is the bond's duration in 9 years? A. 1.00 year B. 1.014 year C. 0.995 year D. 0.983 year E. 0.977 year For a 8-year discount bond with a face value of $1.000. if the interest rate changes from 8% to 12%, what's the new price of the bond using Duration with Convexity? A. $404.87 B. 405.87 C. 406.87 D. 407.87 E. 408.87Please answer part A-D and give a short explanation of how you arrived at the answer. A) Treasury securities that mature in 10 years currently have an interest rate of 14.7%. Inflation is expected to be 5% each of the next three years and 6% each year after the third year. The maturity risk premium is estimated to be 0.2%(t - 1), where t is equal to the maturity of the bond (i.e., the maturity risk premium of a one-year bond is zero). The real risk-free rate is assumed to be constant over time. What is the real risk-free rate of interest? B) Assume that the expectations theory holds, and that liquidity and maturity risk premiums are zero. If the annual rate of interest on a 2-year Treasury bond is 14.8 percent and the rate on a 1-year Treasury bond is 16.3 percent, what rate of interest should you expect on a 1-year Treasury bond one year from now? C) Assume that a 3-year Treasury note has no maturity premium, and that the real, risk-free rate of interest is 3 percent. If the T-note…Please show working Please answer ALL OF QUESTIONS 1 AND 2 1. A bond has a $1,000 par value, 10 years to maturity, and an 8% annual coupon and sells for $980. a. What is its yield to maturity (YTM)? Round your answer to two decimal places. ___________% b. Assume that the yield to maturity remains constant for the next 3 years. What will the price be 3 years from today? Do not round intermediate calculations. Round your answer to the nearest cent.____________% 2. Assume that the risk-free rate is 6% and the required return on the market is 8%. What is the required rate of return on a stock with a beta of 1.5? Round your answer to two decimal places.