The extra compensation paid by the bond seller over the par value when a bond is...
The extra compensation paid by the bond seller over the par value when a bond is called is referred to as the
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call prize. |
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call price. |
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call surcharge. |
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call bonus. |
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call premium. |
Homework Answers
The correct answer is call premium, as it represents extra compensation paid by the bond seller over the par value when a bond is called because the bonds are redeemed before their stipulated redemption date.
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The extra compensation paid by the bond seller over the par
value when a bond is...
What would be tbe yield-to-call of another bond with a par value of $1,000, a 5%...
What would be tbe yield-to-call of another bond with a par value of $1,000, a 5% nominal yield, a 10% call premium and a price of $900 if it were called 6 years after it was purchased? Assume annual coupons.
Bond Bond Value Current Yield Bond A Bond B Bond C Discount Rate 5.00% 15.00% 15.60%...
Bond Bond Value Current Yield Bond A Bond B Bond C Discount Rate 5.00% 15.00% 15.60% Roen is planning to invest in five-year, 15% annual coupon bonds with a face value of $1,000 each. Complete the table by calculating the value of each bond and the current yields at the various discount rates. There is a distinct relationship between the coupon rate, the discount rate, and a bond's price relative to its par value. Based on your preceding calculations, complete...
17. If an investor has paid extra money during application and allotment, before a call is...
17. If an investor has paid extra money during application and allotment, before a call is made, what is that amount called? 18. Where is that amount shown in the balance sheet? 19. How is the account adjusted at the time of call? 20. Companies distribute bonus shares because of this advantage 21. If a shareholder has not paid the call money due on his share, what is it called? 22. How is it shown in the balance sheet? 23....
#16 value investing beats growth investing over extended periods of time. A Corporate Bond-Face Value Par...
#16 value investing beats growth investing over extended periods of time. A Corporate Bond-Face Value Par Value of $1000 with an 8% coupon interest rate. This Bond has no call features. Fill in the table below: Bought at Par or Face Value. What is the purchase price? 65. Bought at a 20% discount to Par or Face Value, what is the purchase price? Bought at a 50% discount to Par or Face Value. What is the purchase yield? Bought at...
The price that the writer (seller) of a call option receives for the underlying asset when...
The price that the writer (seller) of a call option receives for the underlying asset when the option buyer exercises her option is called the Group of answer choices option premium option price strike price spot price
"A 10-year bond pays 5% (Paid Annually) on a face value of $1,000. If similar bonds...
"A 10-year bond pays 5% (Paid Annually) on a face value of $1,000. If similar bonds are currently yielding 10%, what is the market value of the bond?" O $693.25 O $386.00 O "$3,390.85" O "$1,386.09 Question Completion Status: > A Moving to the next question prevents changes to this answer. Question 12 The difference between the price and the par value of a zero-coupon bond represents O taxes payable by the bond buyer O the accumulated principal over the...
Problem #1: Bonds 6% FACTS: Number of bonds Par value of each bond Stated interest rate...
Problem #1: Bonds 6% FACTS: Number of bonds Par value of each bond Stated interest rate Issue date Due date Call % Called on 500 Effective interest rate 1,800 Interest Paid Per Year 4% Payment dates 1/1/20X2 12/31/20X6 Years to maturity 102% 1/1/X6 January 1st July 1st 1.) The value (not par value) of the bond at issue date is what? 2.) At each interest payment date cash is increased (just type the amount) or decreased (type in using a...
A) What is the value of a 3-year par bond with 5% coupon paid annually? B)...
A) What is the value of a 3-year par bond with 5% coupon paid annually? B) Find the value of the bond if the YTM doubles to 10%? Is it in premium or in discount?
Dave purchased a 10-year par value bond with semiannual coupons at a nominal annual rate of...
Dave purchased a 10-year par value bond with semiannual coupons at a nominal annual rate of 4% convertible semiannually at a price of 1021.50. The bond can be called at par value F on any coupon date starting at the end of year 5. The price guarantees that Dave will receive a nominal annual rate of interest convertible semiannually of at least 6%. Determine whether the bond was bought at par, at a discount, or at a premium. at a...
A 20-year, 8% semiannual coupon bond with a par value of $1,000 may be called in...
A
20-year, 8% semiannual coupon bond with a par value of $1,000 may
be called in 5 years at a call price of $1,040. The bond sells for
$1,100. (Assume that the bond has just been issued.)
Basic Input Data:
Years to maturity:
20
Periods per year:
2
Periods to maturity:
40
Coupon rate:
8%
Par value:
$1,000
Periodic payment:
$80
Current price
$1,100
Call price:
$1,040
Years till callable:
5
Periods till callable:
10
e. How would the price...
Bond Bond Value Current Yield Bond A Bond B Bond C Discount Rate 5.00% 15.00% 15.60% Roen is planning to invest in five-year, 15% annual coupon bonds with a face value of $1,000 each. Complete the table by calculating the value of each bond and the current yields at the various discount rates. There is a distinct relationship between the coupon rate, the discount rate, and a bond's price relative to its par value. Based on your preceding calculations, complete...
17. If an investor has paid extra money during application and allotment, before a call is made, what is that amount called? 18. Where is that amount shown in the balance sheet? 19. How is the account adjusted at the time of call? 20. Companies distribute bonus shares because of this advantage 21. If a shareholder has not paid the call money due on his share, what is it called? 22. How is it shown in the balance sheet? 23....
#16 value investing beats growth investing over extended periods of time. A Corporate Bond-Face Value Par Value of $1000 with an 8% coupon interest rate. This Bond has no call features. Fill in the table below: Bought at Par or Face Value. What is the purchase price? 65. Bought at a 20% discount to Par or Face Value, what is the purchase price? Bought at a 50% discount to Par or Face Value. What is the purchase yield? Bought at...
"A 10-year bond pays 5% (Paid Annually) on a face value of $1,000. If similar bonds are currently yielding 10%, what is the market value of the bond?" O $693.25 O $386.00 O "$3,390.85" O "$1,386.09 Question Completion Status: > A Moving to the next question prevents changes to this answer. Question 12 The difference between the price and the par value of a zero-coupon bond represents O taxes payable by the bond buyer O the accumulated principal over the...
Problem #1: Bonds 6% FACTS: Number of bonds Par value of each bond Stated interest rate Issue date Due date Call % Called on 500 Effective interest rate 1,800 Interest Paid Per Year 4% Payment dates 1/1/20X2 12/31/20X6 Years to maturity 102% 1/1/X6 January 1st July 1st 1.) The value (not par value) of the bond at issue date is what? 2.) At each interest payment date cash is increased (just type the amount) or decreased (type in using a...
Dave purchased a 10-year par value bond with semiannual coupons at a nominal annual rate of 4% convertible semiannually at a price of 1021.50. The bond can be called at par value F on any coupon date starting at the end of year 5. The price guarantees that Dave will receive a nominal annual rate of interest convertible semiannually of at least 6%. Determine whether the bond was bought at par, at a discount, or at a premium. at a...
A
20-year, 8% semiannual coupon bond with a par value of $1,000 may
be called in 5 years at a call price of $1,040. The bond sells for
$1,100. (Assume that the bond has just been issued.)
Basic Input Data:
Years to maturity:
20
Periods per year:
2
Periods to maturity:
40
Coupon rate:
8%
Par value:
$1,000
Periodic payment:
$80
Current price
$1,100
Call price:
$1,040
Years till callable:
5
Periods till callable:
10
e. How would the price...
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