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D 3. An investor buys a discount bond that pays out Y = 1,500 in exactly...
An investor buys a discount bond today that promises a face value payout of $4,500 in...
An investor buys a discount bond today that promises a face value payout of $4,500 in exactly four years. The investor holds it for one year and then decides to sell it in a secondary market to a different investor. If the interest rate is 6%, what price does he sell it for? 3,460.66 3,555.0 3,778.29 3,899.85
D 4. An investor buys a bond for $3,466 that pays out $4,117.99 in 2 years....
D 4. An investor buys a bond for $3,466 that pays out $4,117.99 in 2 years. This bond has a yield to maturity of (choose closest value) 4.1% 5.1% 7% 9%
An investor buys a bond for $3,800 that pays out $4,518 in 2 years. This bond...
An investor buys a bond for $3,800 that pays out $4,518 in 2 years. This bond has a yield to maturity of (choose closest value) 4.1% 5.1% 7% 9%
Mike buys a corporate bond with a face value of $1,000 for $800. The bond matures...
Mike buys a corporate bond with a face value of $1,000 for $800. The bond matures in 10 years and pays a coupon interest rate of 5%. Interest is paid every quarter. a. Determine the effective rate of return if Mike holds the bond to maturity? b. What effective interest rate will Mike get if he keeps the bond for only 5 years and sells it for $900?
5. An investor who owns a bond with a 9% coupon rate that pays interest semiannually...
5. An investor who owns a bond with a 9% coupon rate that pays interest semiannually and matures in three years is considering its sale. If the yield-to-maturity on the bond is 11%, find the price of the bond per 100 of par value. 6. A bond offers an annual coupon rate of 5%, with interest paid semiannually. The bond matures in seven years. At a market discount rate of 3%, find the price of this bond per 100 of...
of 25.1 An investor buys percent, what is his after-tax yield? a corporate bond that pays...
of 25.1 An investor buys percent, what is his after-tax yield? a corporate bond that pays an interest rate of 8.35 percent. If the investor pays a marginal tax rate Enter answer in percents, accurate to two decimal places.
A bond with a par value of $100 is currently trading at a price of $104....
A bond with a par value of $100 is currently trading at a price of $104. The bond has a coupon rate of 4.16%, and it has exactly 10 years remaining until maturity. What is the bond’s current yield? An investor buys a bond with a $100 par value and a 5% coupon rate for $97. The bond pays interest semiannually. Exactly one year later, just after receiving the second coupon payment, the investor sells the bond for $96. What...
. Current yield is 6.2% today on a bond that is just issued with 4 years to maturity, 6.5% coupon rate and S1,000 face...
. Current yield is 6.2% today on a bond that is just issued with 4 years to maturity, 6.5% coupon rate and S1,000 face value a) (10 points) What will be the price of this bond exactly in two years (after it distributes its second coupon) if the market rate doubles? c (15 points) How much capital gains should an investor expect to get in the subsequent year if she buys this bond at that time (in two years, after...
1. An investor purchases an annual coupon bond with a 6% coupon rate and exactly 20...
1. An investor purchases an annual coupon bond with a 6% coupon rate and exactly 20 years remaining until maturity at a price equal to par value. The investor’s investment horizon is eight years. The approximate modified duration of the bond is 11.470 years. What is the duration gap at the time of purchase? (Hint: use approximate Macaulay duration to calculate the duration gap) 2. An investor plans to retire in 10 years. As part of the retirement portfolio, the...
An investor buys a five-year, 9% coupon bond for $975, holds it for one year and...
An investor buys a five-year, 9% coupon bond for $975, holds it for one year and then sells the bond for $985. What was the investor's rate of return? The solution given was: 975 = 90/(1+r) +$985/(1+r) r =10.26% What was the original formula the above solution was derived from?
D 4. An investor buys a bond for $3,466 that pays out $4,117.99 in 2 years. This bond has a yield to maturity of (choose closest value) 4.1% 5.1% 7% 9%
Mike buys a corporate bond with a face value of $1,000 for $800. The bond matures in 10 years and pays a coupon interest rate of 5%. Interest is paid every quarter. a. Determine the effective rate of return if Mike holds the bond to maturity? b. What effective interest rate will Mike get if he keeps the bond for only 5 years and sells it for $900?
5. An investor who owns a bond with a 9% coupon rate that pays interest semiannually and matures in three years is considering its sale. If the yield-to-maturity on the bond is 11%, find the price of the bond per 100 of par value. 6. A bond offers an annual coupon rate of 5%, with interest paid semiannually. The bond matures in seven years. At a market discount rate of 3%, find the price of this bond per 100 of...
of 25.1 An investor buys percent, what is his after-tax yield? a corporate bond that pays an interest rate of 8.35 percent. If the investor pays a marginal tax rate Enter answer in percents, accurate to two decimal places.
. Current yield is 6.2% today on a bond that is just issued with 4 years to maturity, 6.5% coupon rate and S1,000 face value a) (10 points) What will be the price of this bond exactly in two years (after it distributes its second coupon) if the market rate doubles? c (15 points) How much capital gains should an investor expect to get in the subsequent year if she buys this bond at that time (in two years, after...
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