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?
A) What is the value of a 3-year par bond with 5% coupon paid annually? B)...
You are about to purchase a 10-year par bond with a 5% coupon rate paid annually. 1.What are the duration and the convexity of this bond? [4 marks] Using first derivative with formula Assume that right after you purchase the bond an economic announcement drives the YTM to 7%. What is the new price of the bond? [1 mark] What price would be predicted by the duration rule after the YTM increases to 7%? Is this answer the same as...
2. Suppose a company issues a bond with a par value of $1,000, 23 years to maturity, and a coupon rate of 5.8% paid annually. If the yield to maturity is 4.7%, what is the current price of the bond? 3. Seekers Inc. issued 15-year bonds a year ago at a coupon rate of 4.1%. The bonds make semiannual payments and have a par value of $1,000. If the YTM is 4.5%, what is the current bond price?
You have just purchased a 10-year, $1,000 par value bond. The coupon de un annually, with interest being paid semiannually. If you expect to earn a 10 percent rate of return (YTM) on this bond, how much did you pay for it? $1,122.87 O $1,003,42 $1,003.42 $875.38 $950.75 $812.15 You have just purchased a 10-year, $1,000 par value bond. The coupon rate on this bond is 8 percent annually, with interest being paid semiannually. If you expect to earn a...
A 10 year 20,000 par value bond has an 10% coupon rate payable semi-annually. It is callable beginning in year 8 at a 5% call premium. An investor buys the bond to yield 6% convertible semi-annually. Find the purchase price of the bond. What is the nominal annual yield on the bond if held to maturity?
1a) what is the value of 10 Year K1000 par value bond with a 10% annual coupon, paid semi annually, if its required return is 10% b) what is the value of a 13% coupon bond that is otherwise identical to the bond described in part c above? would we now have a discount or a premium? c) what is the value of a 7% coupon with these characteristics ? would we now have a discount or premium bond? d) what...
A company issues a ten-year bond at par with a coupon rate of 77% paid semi-annually. The YTM at the beginning of the third year of the bond (8 years left to maturity) is 8.2%. What is the new price of the bond?
A company issues a ten-year bond at par with a coupon rate of 6.6% paid semi-annually. The YTM at the beginning of the third year of the bond (8 years left to maturity) is 9.2%. What is the new price of the bond? A. $ 855 B. $ 1,026 C. $ 1,197 D. $1,000
A company issues a ten-year bond at par with a coupon rate of 7% paid semi-annually. The YTM at the beginning of the third year of the bond (8 years left to maturity) is 9%. What is the new price of the bond? O A. $1,065 O B. $888 OC. $1,243 OD. $1,000
A company issues a ten-year bond at par with a coupon rate of 6.1% paid semi-annually. The YTM at the beginning of the third year of the bond (8 years left maturity) is 8.6%. What is the new price of the bond? O A. $1,201 O B. $858 OC. $1,029 OD. $1,000
A company issues a ten-year bond at par with a coupon rate of 6.5% paid semi-annually. The YTM at the beginning of the third year of the bond (8 years left to maturity) is 8%. What is the new price of the bond? O A. $1,278 O B. $913 OC. $1,095 OD. $1,000