Homework Answers
Coupon = Face value * coupon rate
= $400,000 * 6%/2
= $12,000.
Price=12,000/(1+0.055+0.008*0.5)^0.5 + 12000/(1+0.055+0.008*1)^1 + 12000/(1+0.055+0.008*1.5)^1.5 + (400,000+12000)/(1+0.055+0.008*2)^2=$306,241.63
= 11,660.9321 + 11,288.8053 + 10,887.6617 + 359,185.0684
= $393,022.47
Add Answer to:
The function s(t) = 0.055 + 0.008t gives the effective annual rate of a zero coupon...
Exercise 6. Suppose that a broker quotes the price of unit zero-coupon bonds, with maturity times...
Exercise 6. Suppose that a broker quotes the price of unit zero-coupon bonds, with maturity times of (0.5, 1.0, 1.5, 2.0) years, to be respectively (0.95, 0.92, 0.86,0.84). Calculate the no-arbitrage price of a 2-year bond with face-value £500,000, semi-annual coupons at rate 4% per annum, and no redemption payment.
Question 10 (10 Points): You are given the following bond prices for bonds with annual coupons...
Question 10 (10 Points): You are given the following bond prices for bonds with annual coupons and face and redemption amounts of $100 each Coupon rate (%) Terın to maturity (Years) Price ($) 97.36 94.97 105.36 6 10 Find the annual effective rates of interest for a one, two, and three-year zero-coupon bonds.
A one year zero coupon bond has an effective annual rate of 7.5%. A three year...
A one year zero coupon bond has an effective annual rate of 7.5%. A three year zero coupon bond has an effective annual rate of 10.5%. If a 3 year coupon-bearing bond that pays coupons of 14.5% annually has a yield of 10.1%, what is the effective annual rate of a two year zero coupon bond?
please answer all questions 1. A bond has face value 500 and coupon rate 4%. Coupons...
please answer all questions
1. A bond has face value 500 and coupon rate 4%. Coupons are paid every 6 months, and the redemption amount is the face value. Find the price if the yield rate and time to maturity are a. 5% and 2 years b. 3% and 2 years c. 5% and 15 years d. 3% and 15 years Note the coupon and yield rates are nominal annual interest rates compounded twice a year.
Question 9 Homework • Unanswered An Apple annual coupon bond has a coupon rate of 5.7%,...
Question 9 Homework • Unanswered An Apple annual coupon bond has a coupon rate of 5.7%, face value of $1,000, and 4 years to maturity. If its yield to maturity is 5.7%, what is its Macaulay Duration? Answer in years, rounded to three decimal places. Numeric Answer: Unanswered 2 attempts left Submit Question 10 Homework Unanswered A T-bond with semi-annual coupons has a coupon rate of 6%, face value of $1,000, and 2 years to maturity. If its yield to...
(20pts) 5. The term structure of interest rates for zero-coupon bonds with $100 face value is...
(20pts) 5. The term structure of interest rates for zero-coupon bonds with $100 face value is shown below: Maturity 1 year 2 years 3 years YTM Price 4.60% 2 4.80% 2 5.00% 2 (5pts) (a) Find the current price of the zero-coupon bonds. (15pts) (b) Consider a three-year coupon bond with a $2000 face value that pays 10% annual coupons. Show that the price of this three-year bond must be equal to a portfolio of the above zero-coupon bonds. What...
A T-bond with semi-annual coupons has a coupon rate of 3%, face value of $1,000, and...
A T-bond with semi-annual coupons has a coupon rate of 3%, face value of $1,000, and 2 years to maturity. If its yield to maturity is 4%, what is its Macaulay Duration? Answer in years, rounded to three decimal places
Bond maturity 4 Years initial interest rate = 4.00% Coupon Rate 3.00% Annual Coupon Face Value...
Bond maturity 4 Years initial interest rate = 4.00% Coupon Rate 3.00% Annual Coupon Face Value $1,000.00 Dollar Coupons $30.00 Given the information in the table, what is the price effect in year 3 if the interest rate changes from 4.00% to 6.00 %?
Question Find the equilavent years to maturity ofa zero-coupon bond to one that has a coupon...
Question Find the equilavent years to maturity ofa zero-coupon bond to one that has a coupon rate of 8.60%, 5 years to maturity and a yield to maturity of 9.20% Find the equilavent years to maturity of a zero-coupon bond to one that has a coupon rate of 660% (annual coupons) 10 years to maturity, and a yield to maturity 3 of 6.00%. Find the approximate percentage change in the price of a bond due to a 10 basis point...
6. A $1000 bond pays coupons at a rate of one-third of the effective annual interest...
6. A $1000 bond pays coupons at a rate of one-third of the effective annual interest rate. The present value of the coupons agrees with the present value of the redemption amount. Find the price of the bond.
Exercise 6. Suppose that a broker quotes the price of unit zero-coupon bonds, with maturity times of (0.5, 1.0, 1.5, 2.0) years, to be respectively (0.95, 0.92, 0.86,0.84). Calculate the no-arbitrage price of a 2-year bond with face-value £500,000, semi-annual coupons at rate 4% per annum, and no redemption payment.
Question 10 (10 Points): You are given the following bond prices for bonds with annual coupons and face and redemption amounts of $100 each Coupon rate (%) Terın to maturity (Years) Price ($) 97.36 94.97 105.36 6 10 Find the annual effective rates of interest for a one, two, and three-year zero-coupon bonds.
A one year zero coupon bond has an effective annual rate of 7.5%. A three year zero coupon bond has an effective annual rate of 10.5%. If a 3 year coupon-bearing bond that pays coupons of 14.5% annually has a yield of 10.1%, what is the effective annual rate of a two year zero coupon bond?
please answer all questions
1. A bond has face value 500 and coupon rate 4%. Coupons are paid every 6 months, and the redemption amount is the face value. Find the price if the yield rate and time to maturity are a. 5% and 2 years b. 3% and 2 years c. 5% and 15 years d. 3% and 15 years Note the coupon and yield rates are nominal annual interest rates compounded twice a year.
Question 9 Homework • Unanswered An Apple annual coupon bond has a coupon rate of 5.7%, face value of $1,000, and 4 years to maturity. If its yield to maturity is 5.7%, what is its Macaulay Duration? Answer in years, rounded to three decimal places. Numeric Answer: Unanswered 2 attempts left Submit Question 10 Homework Unanswered A T-bond with semi-annual coupons has a coupon rate of 6%, face value of $1,000, and 2 years to maturity. If its yield to...
(20pts) 5. The term structure of interest rates for zero-coupon bonds with $100 face value is shown below: Maturity 1 year 2 years 3 years YTM Price 4.60% 2 4.80% 2 5.00% 2 (5pts) (a) Find the current price of the zero-coupon bonds. (15pts) (b) Consider a three-year coupon bond with a $2000 face value that pays 10% annual coupons. Show that the price of this three-year bond must be equal to a portfolio of the above zero-coupon bonds. What...
Question Find the equilavent years to maturity ofa zero-coupon bond to one that has a coupon rate of 8.60%, 5 years to maturity and a yield to maturity of 9.20% Find the equilavent years to maturity of a zero-coupon bond to one that has a coupon rate of 660% (annual coupons) 10 years to maturity, and a yield to maturity 3 of 6.00%. Find the approximate percentage change in the price of a bond due to a 10 basis point...
6. A $1000 bond pays coupons at a rate of one-third of the effective annual interest rate. The present value of the coupons agrees with the present value of the redemption amount. Find the price of the bond.
Most questions answered within 3 hours.
-
A square current loop 5.4 cm on each side carries a 510 mA
current. The loop...
asked 21 minutes ago -
What are five tips in conducting knowledge assessment/literature
review research? Each of these tips needs to...
asked 57 minutes ago -
Antigen presenting cells link innate and adaptive immune
responses. In the theoretical scenario where phagosomes cannot...
asked 1 hour ago -
Dealing with conflict, in my opinion, is a skill and an art. I
believe that those...
asked 1 hour ago -
6. A long straight wire with circular cross section and radius
1.5 cm carries a 1.2...
asked 1 hour ago -
Deacon Corporation has provided the following financial data
from its balance sheet and income statement:
Year...
asked 2 hours ago -
List and discuss at least three variables from everyday life for
which you expect the variable ...
asked 2 hours ago -
A high-pass filter consists of a 1.60 μF capacitor in series
with a 125 Ω resistor....
asked 2 hours ago -
A newly developed artificial intelligence has trouble
distinguishing hand-written numbers from hand-written alphabets.
There are pictures...
asked 2 hours ago -
The carbonate ion CO3 2- has multiple resonance structures.
a. Draw them and assign the hybridization...
asked 2 hours ago -
In doing an allocation for a basket purchase
Use the individual costs and the total market...
asked 2 hours ago -
what were the social political and economic causes and impacts of
the late 19th century urban...
asked 2 hours ago