Question

Please include cell references.

Problem 6-12 Suppose a 10-year, $1,000 bond with an 8% coupon rate and semiannual coupons is trading for $1,034.74 Complete the steps below using cell references to given data or previous calculations. In some cases, a simple cell reference is all you need. To copy/paste a formula across a row or down a column, an absolute cell reference or a mixed cell reference may be preferred. If a specific Excel function is to be used, the directions will specify the use of that function. Do not type in mumerical data into a cell or function. Instead, make a reference to the cell in which the data is found. Make your computations only in the blue cells highlighted below. In all cases, unless otherwise directed, use the earliest appearance of the data in your formulas, usually the Given Data section What is the bond's yield to maturity expressed as an APR with semiannual compounding)? b. If the bond's yield to maturity changes to 9% APR, what will the bond's price be? 10 1,000 Maturity (years) Face value Coupon rate Bond price 6-12 $ 1,034.74 Ready

Answer 1

ДА 10 Maturity (years) Face value Coupon price Bond price $1,000 8% $1,034.74 16 Coupon payment Number of periods YTM $40 (semi-annual) 20 (semi-annual) 7.50% 18 20 23 24 25 26 New semi-annual YTM New price 4.50% $934.96

BEHOV AWN 10 Maturity (years) Face value Coupon price Bond price 1000 0.08 1034.74 Coupon payment Number of periods YTM =D9*D10/2 =D8*2 =2*RATE(D16,D15,-D11,09) (semi-annual) (semi-annual) 24 New semi-annual YTM New price =9%/2 =-PV(D23,D16,D15,D9) 26