A discount price bonds YTM is equal to: current yield YTC Nominql yield None of the...
A discount price bonds YTM is equal to:
Homework Answers
None of the above.
The yield of a discount bond will be higher than its nominal yield (coupon rate). However, it will not be equal to its current yield, because the YTM will equal current yield only when a bond is trading at par. The YTM will equal nominal yield (coupon rate) when a bond is trading at par.
Add Answer to:
A discount price bonds YTM is equal to:
current yield
YTC
Nominql yield
None of the...
Problem 7-10 Current yield, capital gains yield, and yield to maturity Pelzer Printing Inc. has bonds...
Problem 7-10 Current yield, capital gains yield, and yield to maturity Pelzer Printing Inc. has bonds outstanding with 24 years left to maturity. The bonds have an 12% annual coupon rate and were issued 1 year ago at their par value of $1,000. However, due to changes in interest rates, the bond's market price has fallen to $920.70. The capital gains yield last year was -7.93%. a. What is the yield to maturity? Round your answer to two decimal places....
Problem 5-22 Yield to Maturity and Yield to Call Arnot International's bonds have a current market...
Problem 5-22 Yield to Maturity and Yield to Call Arnot International's bonds have a current market price of $1,350. The bonds have an 12% annual coupon payment, a $1,000 face value, and 10 years left until maturity. The bonds may be called in 5 years at 109% of face value (call price = 1,090). What is the yield to maturity? Round your answer to two decimal places. % **already know the answer is 7.01 I need the answer for B,...
Bond Bond Value Current Yield Bond A Bond B Bond C Discount Rate 5.00% 15.00% 15.60%...
Bond Bond Value Current Yield Bond A Bond B Bond C Discount Rate 5.00% 15.00% 15.60% Roen is planning to invest in five-year, 15% annual coupon bonds with a face value of $1,000 each. Complete the table by calculating the value of each bond and the current yields at the various discount rates. There is a distinct relationship between the coupon rate, the discount rate, and a bond's price relative to its par value. Based on your preceding calculations, complete...
Problem 7-18 Yield to maturity and yield to call Kaufman Enterprises has bonds outstanding with a...
Problem 7-18 Yield to maturity and yield to call Kaufman Enterprises has bonds outstanding with a $1,000 face value and 10 years left until maturity. They have an 11% annual coupon payment, and their current price is $1,175. The bonds may be called in 5 years at 109% of face value (Call price = $1,090). a. What is the yield to maturity? Round your answer to two decimal places. % b. What is the yield to call if they are...
YIELD TO MATURITY A firm's bonds have a maturity of 14 years with a $1,000 face...
YIELD TO MATURITY A firm's bonds have a maturity of 14 years with a $1,000 face value, have an 11% semiannual coupon, are callable in 7 years at $1,238, and currently sell at a price of $1,407.26. What is their nominal yield to maturity? Do not round intermediate calculations. Round your answer to two decimal places. % What is their nominal yield to call? Do not round intermediate calculations. Round your answer to two decimal places. % What return should...
INTEREST RATE SENSITIVITY An investor purchased the following 5 bonds. Each bond had a par value...
INTEREST RATE SENSITIVITY An investor purchased the following 5 bonds. Each bond had a par value of $1,000 and an 10% yield to maturity on the purchase day. Immediately after the investor purchased them, interest rates fell, and each then had a new YTM of 5%. What is the percentage change in price for each bond after the decline in interest rates? Fill in the following table. Round your answers to the nearest cent or to two decimal places. Enter...
YIELD TO MATURITY A firm's bonds have a maturity of 14 years with a $1,000 face...
YIELD TO MATURITY A firm's bonds have a maturity of 14 years with a $1,000 face value, have an 11% semiannual coupon, are callable in 7 years at $1,224, and currently sell at a price of $1,386. a. What is their nominal yield to maturity? Do not round intermediate calculations. Round your answer to two decimal places. % b. What is their nominal yield to call? Do not round intermediate calculations. Round your answer to two decimal places. c. What...
YIELD TO MATURITY A firm's bonds have a maturity of 12 years with a $1,000 face...
YIELD TO MATURITY A firm's bonds have a maturity of 12 years with a $1,000 face value, have an 8% semiannual coupon, are callable in 6 years at $1,054, and currently sell at a price of $1,104.30. a. What is their nominal yield to maturity? Do not round intermediate calculations. Round your answer to two decimal places. b. What is their nominal yield to call? Do not round intermediate calculations. Round your answer to two decimal places. c. What return...
7-4: Bond Yields 7-6: Bonds with Semiannual Coupons Yield to maturity A firm's bonds have a...
7-4: Bond Yields 7-6: Bonds with Semiannual Coupons Yield to maturity A firm's bonds have a maturity of 10 years with a $1,000 face value, have an 8% semiannual coupon, are calable in 5 years at $1,050, and currently sell at a price of $1,095.17. a. What is their nominal yield to maturity? Round your answer to two decimal places b. What is their nominal yield to call? Round your answer to two decimal places c. What return should investors...
4. YIELD TO MATURITY A firm's bonds have a maturity of 14 years with a $1,000...
4.
YIELD TO MATURITY A firm's bonds have a maturity of 14 years with a $1,000 face value, have an 8% semiannual coupon, are callable in 7 years at $1,065, and currently sell at a price of $1,122.74. a. What is their nominal yield to maturity? Do not round intermediate calculations. Round your answer to two decimal places. 6.64 % b. What is their nominal yield to call? Do not round intermediate calculations. Round your answer to two decimal places....
Problem 7-10 Current yield, capital gains yield, and yield to maturity Pelzer Printing Inc. has bonds outstanding with 24 years left to maturity. The bonds have an 12% annual coupon rate and were issued 1 year ago at their par value of $1,000. However, due to changes in interest rates, the bond's market price has fallen to $920.70. The capital gains yield last year was -7.93%. a. What is the yield to maturity? Round your answer to two decimal places....
Bond Bond Value Current Yield Bond A Bond B Bond C Discount Rate 5.00% 15.00% 15.60% Roen is planning to invest in five-year, 15% annual coupon bonds with a face value of $1,000 each. Complete the table by calculating the value of each bond and the current yields at the various discount rates. There is a distinct relationship between the coupon rate, the discount rate, and a bond's price relative to its par value. Based on your preceding calculations, complete...
Problem 7-18 Yield to maturity and yield to call Kaufman Enterprises has bonds outstanding with a $1,000 face value and 10 years left until maturity. They have an 11% annual coupon payment, and their current price is $1,175. The bonds may be called in 5 years at 109% of face value (Call price = $1,090). a. What is the yield to maturity? Round your answer to two decimal places. % b. What is the yield to call if they are...
INTEREST RATE SENSITIVITY An investor purchased the following 5 bonds. Each bond had a par value of $1,000 and an 10% yield to maturity on the purchase day. Immediately after the investor purchased them, interest rates fell, and each then had a new YTM of 5%. What is the percentage change in price for each bond after the decline in interest rates? Fill in the following table. Round your answers to the nearest cent or to two decimal places. Enter...
YIELD TO MATURITY A firm's bonds have a maturity of 14 years with a $1,000 face value, have an 11% semiannual coupon, are callable in 7 years at $1,224, and currently sell at a price of $1,386. a. What is their nominal yield to maturity? Do not round intermediate calculations. Round your answer to two decimal places. % b. What is their nominal yield to call? Do not round intermediate calculations. Round your answer to two decimal places. c. What...
YIELD TO MATURITY A firm's bonds have a maturity of 12 years with a $1,000 face value, have an 8% semiannual coupon, are callable in 6 years at $1,054, and currently sell at a price of $1,104.30. a. What is their nominal yield to maturity? Do not round intermediate calculations. Round your answer to two decimal places. b. What is their nominal yield to call? Do not round intermediate calculations. Round your answer to two decimal places. c. What return...
7-4: Bond Yields 7-6: Bonds with Semiannual Coupons Yield to maturity A firm's bonds have a maturity of 10 years with a $1,000 face value, have an 8% semiannual coupon, are calable in 5 years at $1,050, and currently sell at a price of $1,095.17. a. What is their nominal yield to maturity? Round your answer to two decimal places b. What is their nominal yield to call? Round your answer to two decimal places c. What return should investors...
4.
YIELD TO MATURITY A firm's bonds have a maturity of 14 years with a $1,000 face value, have an 8% semiannual coupon, are callable in 7 years at $1,065, and currently sell at a price of $1,122.74. a. What is their nominal yield to maturity? Do not round intermediate calculations. Round your answer to two decimal places. 6.64 % b. What is their nominal yield to call? Do not round intermediate calculations. Round your answer to two decimal places....
Most questions answered within 3 hours.
-
4. Without doing any calculations, predict whether the observed
∆T would increase, decrease or remain the...
asked 19 minutes ago -
Based on the range, which of the following sets of scores has
the greatest variability? 3,...
asked 1 hour ago -
Ripples in a pond travel at a velocity of 3 m/s with one peak
passing a...
asked 1 hour ago -
A man stands on the roof of a building of height 13.0 mm and
throws a...
asked 1 hour ago -
The extent to which assets are financed by borrowed funds and
other liabilities is indicated by:...
asked 2 hours ago -
Explain in detail
Germany is the fifth largest economy
explain what goods and services Germany specializes...
asked 2 hours ago -
The density of platinum is 21.45 g/mL. If a cube of platinum
with a mass of...
asked 2 hours ago -
Accounts Receivable
Sales
A/R Posting
Extended Sales Invoice
Packing Slip
Compare invoice to packing slip 2...
asked 2 hours ago -
Michaella, age 23, is a full-time law student and is claimed by
her parents as a...
asked 2 hours ago -
Why are polymers not typically casted into products?
asked 3 hours ago -
When rolling a die 129 times, what is the probability of rolling
a 6 no more...
asked 3 hours ago -
4. A call option currently sells for $7.75. It has a strike
price of $85 and...
asked 3 hours ago