If you buy a bond for a premium, is your yield-to-maturity higher, lower or the same...
If you buy a bond for a premium, is your yield-to-maturity higher, lower or the same as the going market interest rates.
Homework Answers
If the bond is bought for premium, the yield to maturity is lower than coupon rate. So, if coupon rate is the ongoing market rate, yield to maturity is lower than the ongoing market rates.
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If you buy a bond for a premium, is your yield-to-maturity
higher, lower or the same...
Given that two bonds have the same maturity, yield to maturity and different coupon rate, which...
Given that two bonds have the same maturity, yield to maturity and different coupon rate, which of the following is true? Is it A.The high coupon bond will be sold for premium. B. The lower coupon bond will be sold for premium. C.The high coupon bond will have higher interest rate risk., D.The low coupon rate bond will have higher interest rate risk.?
The options for a are "the same", "a higher", or "a lower" The options for b...
The options for a are "the same", "a higher", or "a
lower"
The options for b are "the same", "a higher", or "a
lower"
The options for c are "terms to maturity", "credit
risks", or "tax treatment"
The options for d are "the same", "a higher",
or "a lower
You would expect a bond of an Eastern European government to pay the same interest rate as compared to a bond of the U.S. government interest rate as compared to a...
coupon income c. If you buy the bond today and hold it to maturity, your return...
coupon income c. If you buy the bond today and hold it to maturity, your return will be yield to b. The yield to maturty l maturity The relationship between price and yield is that the higher the price you pay for a bond, the higher the yield 10. Which one of the followving statements is correct regarding interest rates and bond values? When the interest rate rises, the present value of the payments to be received by the bondholder...
The relationship between interest rates and bond maturity is called: A) Liquidity premium B) Yield to...
The relationship between interest rates and bond maturity is called: A) Liquidity premium B) Yield to maturity C) Term structure of interest rates D) Maturity risk E) Inflation premium 2.
Bond pricing and yield to maturity: Be able to make future value and present value calculatio...
Bond pricing and yield to maturity: Be able to make future value and present value calculations with given values of i and n. For example, what is the future value of $500 saved for two years at a 5% annual interest rate? How does present value change for larger values of i? How does it change for larger values for n? What is a debt instrument? What are the three main characteristics of a debt instrument? ...
22. You are considering a 9 percent coupon bond. When the yield to maturity (YTM) is...
22. You are considering a 9 percent coupon bond. When the yield to maturity (YTM) is 7.5 percent this bond has a price that is ________ than its face value. In other words, this bond is traded at a ________. 1) higher; premium 2) higher; discount 3) lower; premium 4) lower; discount
1. Two bonds A and B have the same credit rating, the same par value and the same coupon rate. Bond A has 30 years to maturity and bond B has five (5) years to maturity. Please demonstrate your understanding of interest rates risk by answering the followi
1. Two bonds A and B have the same credit rating, the same par value and the same coupon rate. Bond A has 30 years to maturity and bond B has five (5) years to maturity. Please demonstrate your understanding of interest rates risk by answering the following questions :● Discuss which bond will trade at a higher price in the market● Discuss what happens to the market price of each bond if the interest rates in the economy go...
You buy a 5-year zero coupon bond with 4% yield to maturity. You sell the bond...
You buy a 5-year zero coupon bond with 4% yield to maturity. You sell the bond 2 years later when it's yield to maturity is 2%. What was your annualized holding period return?
Options are: 1. a lower/a higher/same 2. credit risks/tax treatments/terms to maturity 3. credit risks/tax treatments/terms...
Options are: 1. a lower/a higher/same 2. credit risks/tax
treatments/terms to maturity 3. credit risks/tax treatments/terms
to maturity 4. credit risks/tax treatments/terms to
maturity
You would expect a bond of the U.S. government to pay interest rate as compared to a bond of an Eastern European government. You would expect a bond that repays the principal in year 2040 and a bond that repays the principal in year 2020 to pay different interest rates because of differences in the bonds'...
If its yield to maturity is less than its coupon rate, a bond will sell at...
If its yield to maturity is less than its coupon rate, a bond will sell at a _____, and increases in market interest rates will _____ . discount; decrease this discount discount; increase this discount premium; decrease this premium premium; increase this premium
The options for a are "the same", "a higher", or "a
lower"
The options for b are "the same", "a higher", or "a
lower"
The options for c are "terms to maturity", "credit
risks", or "tax treatment"
The options for d are "the same", "a higher",
or "a lower
You would expect a bond of an Eastern European government to pay the same interest rate as compared to a bond of the U.S. government interest rate as compared to a...
coupon income c. If you buy the bond today and hold it to maturity, your return will be yield to b. The yield to maturty l maturity The relationship between price and yield is that the higher the price you pay for a bond, the higher the yield 10. Which one of the followving statements is correct regarding interest rates and bond values? When the interest rate rises, the present value of the payments to be received by the bondholder...
The relationship between interest rates and bond maturity is called: A) Liquidity premium B) Yield to maturity C) Term structure of interest rates D) Maturity risk E) Inflation premium 2.
Options are: 1. a lower/a higher/same 2. credit risks/tax
treatments/terms to maturity 3. credit risks/tax treatments/terms
to maturity 4. credit risks/tax treatments/terms to
maturity
You would expect a bond of the U.S. government to pay interest rate as compared to a bond of an Eastern European government. You would expect a bond that repays the principal in year 2040 and a bond that repays the principal in year 2020 to pay different interest rates because of differences in the bonds'...
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