PV = -7,700; FV = 10,000; PMT (semi-annual coupon) = 6%*10,000/2 = 300; N = 6*2 = 12, solve for RATE.
Semi-annual YTM = 5.70%
Annual rate of return = 5.70%*2 = 11.40%
A mortgage bond issued by Automation Engineering is for sale for $7.700. The bond has a...
A mortgage bond issued by Automation Engineering is for sale for $8,900. The bond has a face value of $10,000 with a coupon rate of 5% per year, payable annually. What rate of return will be realized if the purchaser holds the bond to maturity 9 years from now? The rate of return will be % per year.
Question 2 (25 points) A mortgage bond issued by Automation Engineering is for sale for $8,500. The bond has a face value of $12,000 with a coupon rate of 8% per year, payable semiannually. What semiannual rate of return will be realized if the purchaser holds the bond to maturity 5 years from now?
Question 2 (25 points) A mortgage bond issued by Automation Engineering is for sale for $8,500. The bond has a face value of $12,000 with a coupon rate of 8% per year, payable semiannually. What semiannual rate of return will be realized if the purchaser holds the bond to maturity 5 years from now?
8. During recessionary periods, bonds that were issued many years ago have a higher coupon rate than currently issued bonds. Therefore, they may sell at a premium, a price higher than their face value, because of currently low coupon rates. A $50,000 bond that was issued 15 years ago is for sale for $58,000. What rate of return per year will a purchaser make if the bond coupon rate is 20% per year payable semi-annually, and the bond is due...
I need help with question 7.50. I looked at the solution for this one but I don't know if the solution is right or wrong because so many people did not find the solution helpful 205 Exercises for Spreadsheets $10,000 and a coupon rate of 85 per year. payable semiannually? .45 7.46 If you receive a 55000 bond as a graduation present and the bond will pay you $75 interest every 3 months for 20 years, what is the bond...
A bond has just been issued. The bond is currently selling for $1050. The bond will mature in 7 years. The bond’s annual coupon rate is 16% and the face value of the bond is $1,000. Coupons will be paid semi-annually. Excel Compute the bond’s annual yield to maturity.
Consider two bonds. The first is a 6% coupon bond with six years to maturity, and a yield to maturity of 4.5% annual rate, compounded semi-annually. The second bond is a 2% coupon bond with six years to maturity and a yield to maturity of 5.0%, annual rate, compounded semi-annually. 1. Calculate the current price per $100 of face value of each bond. (You may use financial calculator to do question 1 and 2, I'm just unsure how to use...
You are planning to buy a bond and are considering 2 options. Your one requirement is that you need to buy the lower price bond. Your desired nominal yield after tax is 4%, convertible semi-annually. The details of the 2 bonds under consideration are as follows: A corporate bond with a 10,000 par value, a 4 year term, and a coupon rate of 6% payable semi-annually. The tax rate applicable on corporate bond coupon payments is 30%. The bond will...
Corp-X issued corporate bonds one year ago at par with a face value of $1000, an annual coupon rate of 6%(paid semi annually), and a 20 years to maturity. At the moment, bonds of equivalent risk and maturity to these Corp-X bonds are being issued at par with a coupon rate of 5.5% per year(paid semi annually) 1. At the time that Corp-X bonds were issued, what was the Yield to Maturity of the bonds? And What is the current...
A government bond with a face value of $1,000 was issued eight years ago there are seven years remaining unit maturity. The bond pays semi-annual coupon payments of $45, the coupon rate is 9% p.a. paid twice yearly and rate in the marketplace are 9.6% p.a. compounded semi annually. What is the value of the bond today?