Bond Valuation A 20-year, 8% semiannual coupon bond with a par value of $1,000 sells for...

Question

Question

Bond Valuation A 20-year, 8% semiannual coupon bond with a par value of $1,000 sells for $1,100. (Assume that the bond has ju

business finance

Add a comment Improve this question Transcribed image text

Answer 1

Answer #1

Face value of bond(FV) = $ 1000

Number of years (nper) = 3

YTM of the bond(rate) = 5.75%

Coupon payment(PMT) = 0 ( since it is a zero coupon bond)

Price of the bond (PV) = = $ 845.59

Add a comment

Answer 2

Similar Homework Help Questions

Bond Valuation A 20-year, 8% semiannual coupon bond with a par value of $1,000 sells for...

Bond Valuation A 20-year, 8% semiannual coupon bond with a par value of $1,000 sells for $1,100. (Assume that the bond has just been issued.) Basic Input Data: Years to maturity: Periods per year. Periods to maturity: Coupon rate: Par value: Periodic payment: Current price 8% $1,000 $1,100 b. What would be the price of the bond if market interest rates change to: 12% 6% 10% Nominal market rate, r: Value of bond:
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: Coupon rate: 8% Par value: $1,000 Periodic payment: Current price $1,100 Call price: $1,040 Years till callable: 5 Periods till callable: a. What is the bond's yield to maturity?...
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...

A 20 year, 8% semi-annual coupon bond with a par value of $1,000 may be called...

A 20 year, 8% semi-annual coupon bond with a par value of $1,000 may be called in 10 years at a call price of $1,100. The bond sells for $1,200. e. How would the price of the bond be affected by a change in the going market interest rates? Please show work ( by adding numbers or CELL with formula if needed). Thank you, will rate. L M N I e a A 20 year, 8% semi-annual coupon bond with...
A 23-year, semiannual coupon bond sells for $981.73. The bond has a par value of $1,000...

A 23-year, semiannual coupon bond sells for $981.73. The bond has a par value of $1,000 and a yield to maturity of 6.81 percent. What is the bond's coupon rate? A 23-year, semiannual coupon bond sells for $981.73. The bond has a par value of $1,000 and a yield to maturity of 6.81 percent. What is the bond's coupon rate? Multiple Choice 3.33% 5.99% 6.65% 4.99%
BOND VALUATION Nesmith Corporation's outstanding bonds have a $1,000 par value, a 8% semiannual coupon, 11...

BOND VALUATION Nesmith Corporation's outstanding bonds have a $1,000 par value, a 8% semiannual coupon, 11 years to maturity, and an 11% YTM. What is the bond's price? Round your answer to the nearest cent. Bond Price=$______

A 25-year, 8% semiannual coupon bond with a par value of $1,000 may be called in...

A 25-year, 8% semiannual coupon bond with a par value of $1,000 may be called in 4 years at a call price of $1,100. The bond sells for $950. (Assume that the bond has just been issued.) a. What is the bond's yield to maturity? Round your answer to two decimal places b. What is the bond's current yield? Round your answer to two decimal places. c. What is the bond's capital galn or loss yleld? Loss should be Indicated...
Bond Valuation Nesmith Corporation's outstanding bonds have a $1,000 par value, an 8% semiannual coupon, 14...

Bond Valuation Nesmith Corporation's outstanding bonds have a $1,000 par value, an 8% semiannual coupon, 14 years to maturity, and an 11% YTM. What is the bond's price? (Without using a calculator or excel)
3. A 12-year, 12% semiannual coupon bond with a par value of $1,000 may be called...

3. A 12-year, 12% semiannual coupon bond with a par value of $1,000 may be called in 6 years at a call price of $1,030. The bond sells for $1,150. (Assume that the bond has just been issued.) a. What is the bond’s yield to maturity? b. What is the bond’s current yield? c. What is the bond’s capital gain or loss yield? d. What is the bond’s yield to call?

One year ago, Gangnam Inc. issued a 12-year, 6% semiannual coupon bond at its par value...

One year ago, Gangnam Inc. issued a 12-year, 6% semiannual coupon bond at its par value of $1,000. The bond can be called in 8 years at a price of $1,100 and it now sells for $855.49. The bond has a yield to maturity of 8%. IB Attempt 1/5 for 10 pts. Part 1 What is the current yield? 3+ decimals Submit 1 - Attempt 1/5 for 10 pts. Part 2 What is the expected capital gains yield for the...

Bond Valuation A 20-year, 8% semiannual coupon bond with a par value of $1,000 sells for...

Homework Answers