15. A fixed interest rate over the life of bond and par value at maturity.
16. They make foreign goods expensive and so they buy less
17. Both are true
18. Present value
19. Inversely, fall, rises
These all are facts. Dont need explanation
QUESTION 15 A coupon bond pays the owner of the bond - the same amount every...
If a coupon bond has two years to maturity, a coupon rate of 10%, a par value of S900, and a yield to maturity of 14%, then the coupon bond will sell for $(Round your response to the nearest two decimal place The price of a bond and its yield to maturity are Which of the following statements is not true? O A. Current yield is a worse approximation of yield to maturity for long-term bonds when compared to short-term...
QUESTION 19 (1) The value (price) of a bond is inversely related to changes in interest rates (and yield-to-maturity). (2) Holding yields constant, price will converge to par value as we approach the maturity date of a bond. (1) is True but (2) is False (1) is False but (2) is True (1) and (2) are both False. (1) and (2) are both True.
QUESTION 19 (1) The value (price) of a bond is inversely related to changes in interest rates (and yield-to-maturity). (2) Holding yields constant, price will converge to par value as we approach the maturity date of a bond. (1) is True but (2) is False (1) is False but (2) is True (1) and (2) are both False (1) and (2) are both True.
Pleaae solve all 14. (I) A discount bond requires the borrower to repay the principal at the maturity date plus an interest payment. (II) A coupon bond pays the lender a fixed interest payment every year until the maturity date, when a specified final amount (face or par value) is repaid. A) (D) is true, (II) false. C) Both are true. B) (1) is false, (II) true. D) Both are false. 15. With an interest rate of 10 percent, the...
A coupon bond pays $100 at the end of each year for 3 years, and at the maturity date in 3 years, in addition to the final coupon payment, the bond also makes a face value payout of $500. If the interest rate is 3% then this bond has a present value of $740.43 $755.55 $762.98 $808.08
A bond of par value 1,000 pays a coupon of 4% p.a. annually for 20 years and the par value is 1,000 (coupon calculated on this number and not on maturity value). Calculate the following: The price of the bond and the current yield/ maturity of the bond is also 4%, if the 1. a. maturity value is: . $1,000 i. $950 b. Explain the answers as to the prices of the bonds as to why they are equal to,...
You own a bond that has a 6% annual coupon rate and matures 5 years from now. You purchased this 10-year bond at par value when it was originally issued. Which one of the following statements applies to this bond if the relevant market interest rate is now 5.8% (yield to maturity)? You purchase a bond with a coupon rate of 6.25% and a par value of $1,000. There are 53 days to the next semiannual coupon payment date and...
I need #4 4. Assuming the same coupon payment as listed in question 3 but now the price you pay for the bond increases to $101.00, what is the current yield, did it rise or fall? 5. Presume you purchased a 10 year year bond for $1,000, which has a face value of $1000.00. The bond pays an annual coupon of $60.00 and has an interest rate (Yeild to maturity) of of 6%. Presume you decide to sell the bond...
QUESTION 25 Compute the value of an 8% coupon, 30- year maturity bond with par value of $1,000. The market yield is currently 8%: O 950 1,000 0 1,050 0 1,100 QUESTION 26 True or False: When graphing a bonds price yield relationship (price on Y-axis, yield on X-axis, the convex, non-constant slope illustrates the inverse relationship between prices and yields. o True O False
. Example: . Suppose a firm issued a 9% coupon bond (semiannual coupon) 20 years ago. The bond n ow has 10 years left until its maturity date. The bond is selling at $ 750. . But the firm is having financial difficulty. Investors believe that the firm will be able to ma ke good on the remaining interest rate payments but that at the maturity date, the firm w ill be forced into bankruptcy and bondholders will receive only...