Question

Question 10 5 pts Eagle Industries' bonds have a 10-year maturity and a 8.40% coupon paid semiannually. They sell at their $1,000 par value, and are not callable. What is the effective annual rate (EFF%) for these bonds? Recall that EFF%= (1 + (Nominal Rate /n))" - 1 Your answer should be between 7.20 and 9.12, rounded to 2 decimal places, with no special characters. D Question 11 5 pts Pandora Media plans to issue original issue discount (OID) bonds with a 20-year maturity. $1,000 par value, and initial yield to maturity of 8%. Since these bonds are issued below par, the total yield will come from both annual coupon payments and appreciation. If the bonds are offered at a discounted price of $910, what is their nominal coupon rate? That is, at this price, what coupon rate will result in a yield to maturity of 8%? Your answer should be between 5.12 and 8.74, rounded to 2 decimal places, with no special characters.

Answer 1

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

ANSWERS : Q.10 : 8.58, Q.11 : 7.08

All em - 9 w v ( 1 03:36 ENG 16-03-202022 fix DB826 - 826 cw X cx cr cz DA DB DC DD DE DF DG - 827 Q.10 8.40% COUPON RATE SEMI ANNUAL COUPON 828 829 830 831 832 EFFECTIVE ANNUAL RATE = (1+ (r/m))m - 1 EFFECTIVE ANNUAL RATE = (1+ (0.084/2))^2 - 1 EFFECTIVE ANNUAL RATE = 8.5764% 833 ANSWER EFFECTIVE ANNUAL RATE 8.58% 834 835 836 837 838 Q.11 20 839 YEARS PAR VALUE YTM PRICE 1000 8% 910 COUPON ANNUAL COUPON RATE 70.83 [=PMT(CZ840, C2838,-CZ841,C2839)] 7.08% (70.83/1000) ANSWER 840 841 842 843 844 845 846 847 848 849 YIELD SPOT AFN BANKING NOTE Sheet251 53 CLEAN PRICE S10 BIDDING, UNDERWRITING EUAC AW LIFE LP, IP, MRP, INFLATION WARR... :