Calculations of Coupon rate and Price of the bond :
Price of the bond (P) = {Face value (F)× Coupon rate (CR)} / Yeild to maturity (YTM)
IBM coupon bond :
Price = ($ 5,000 × 5.5%) / 8.5%
Price = $ 275 / 8.5%
Price = $ 3,235.29
AOL coupon bond :
Price = (F × CR)/YTM
$ 3,876.32 = (5,000 × CR) / 7.5%
$ 3,876.32 × 7.5% = 5,000 × CR
290.724 = 5,000 × CR
CR = 290.725/5,000
Coupon rate = 5.81% (approximately)
Missing information on a bond. Your broker faxed to you the following information about two monthly...
Missing information on a bond. Your broker faxed to you the following information about two monthly coupon bonds that you are considering as a potential investment. Unfortunately, your fax machine is blurring some of the items, and all you can read from the fax on the two different bonds is the following: . Fill in the missing data from the information that the broker sent. What is the price of the IBM coupon bond? $ (Round to the nearest cent.)...
Missing information on a bond. Your broker faxed to you the following information about two monthly coupon bonds that you are considering as a potential investment. Unfortunately, your fax machine is blurring some of the items, and all you can read from the fax on the two different bonds is the following: E . Fill in the missing data from the information that the broker sent. i Data Table (Click on the following icon in order to copy its contents...
Your broker faxed to you the following information about two annual coupon bonds that you are considering as a potential investment. Unfortunately, your fax machine is blurring some of the items, and all you can read from the fax on the two different bonds is the following. Fill in the missing data from the information that the broker sent. What is the price of the IBM coupon bond? Features IBM Coupon Bond AOL Coupon Bond Face value (Par) 1,000 5,000...
Missing information on a bond. Your broker faxed to you the following information about two annual coupon bonds that you are considering as a potential investment. Unfortunately, your fax machine is blurring some of the items, and all you can read from the fax on the two different bonds is the following: . Fill in the missing data from the information that the broker sent. What is the price of the IBM coupon bond? $ (Round to the nearest cent.)...
Q1. What is the price of the IBM coupon bond? Q2. What is the price of AOL coupon bond? Missing information on a bond. Your broker faxed to you the following information about two monthly coupon bonds that you are considering as a potential investment. Unfortunately, your fax machine is blurring some of the items, and all you can read from the fax on the two different bonds is the following: B. Fill in the missing data from the information...
P6-18 (similar to) Question Help 0 Missing information on a bond. Your broker faxed to you the following information about two monthly coupon bonds that you are considering as a potential investment. Unfortunately, your fax machine is blurring some of the items, and all you can read from the fax on the two different bonds is the following: 3. Fill in the missing data from the information that the broker sent. What is the price of the IBM coupon bond?...
4. [5 Points] Your broker offers you the opportunity to purchase a bond with coupon payments of $80 per year and a face value of $1,000. If the yield to maturity on similar bonds is 7%, will the bond price be greater or less than the face value and why? What is the bond called? If the yield to maturity on similar bonds increases to 9%, what will happen to the bond price?
Your broker offers you the opportunity to purchase a bond with a coupon rate of 7% per year and a face value of $1,000. If the yield to maturity on similar bonds is 8%, this bond should: Sell at par value. Sell at a premium to face value. Unable to determine if sold at premium or discount to face value. Sell at a discount to face value. O Sell at the same price as the similar bond regardless of the...
thank you Suppose a bond with annual coupons has a price of $1,071.06, a face value of $1000 and a yield to maturity of 7%. This bond's coupon rate is closest to: PS. There is no missing data in this question. Select one: O a. 5.5% b. 7.5% C. 6.5% d. 6.0%
You own two bonds. Bond A is a 10% coupon bond with a yield of 5% which makes payments every quarter and matures in 15 years. The face value of the bond is $100000. Bond B is a 3% coupon bond with a yield of 8% that makes payments every month and has a maturity of 10 years. Calculate the value of each bond at every coupon payments date until maturity using excel. Graph your results.