Bonds of Zello Corporation with a par value of $1,000 sell for $1,080, mature in 18 years, and have a 7% annual coupon r...
Bonds of Zello Corporation with a par value of $1,000 sell for $1,080, mature in 18 years, and have a 7% annual coupon rate paid annually, what is the yield to maturity? what is the current yield? what is the capital gains (loss) yield?
please show step by step solution.for full credit, Not excel workings. Thank you!!!
Homework Answers
Using financial calculator
Input: FV= 1000,
PV = -1080
N = 18
PMT = 7%*1000 = 70
Solve for I/Y as 6.25
Hence YTM = 6.25%
2: Current yield = Annual coupon/Price
= 70/1080 = 6.48%
3: Capital gain yield = (P1-P0)/P0
= (1000-1080)/1080
= -7.41%
Add Answer to:
Bonds of Zello Corporation with a par value of $1,000 sell for $1,080, mature in 18 years, and have a 7% annual coupon r...
2). Bonds of Zello Corporation with a par value of $1,000 sell for $1,080, mature in...
2). Bonds of Zello Corporation with a par value of $1,000 sell for $1,080, mature in 18 years, and have a 7% annual coupon rate paid annually, what is the yield to maturity? what is the current yield? what is the capital gains (loss) yield?
Bonds of Francesca Corporation with a par value of $1,000 sell for $930, mature in five...
Bonds of Francesca Corporation with a par value of $1,000 sell for $930, mature in five years, and have a 8% annual coupon rate paid semiannually. Do not round intermediate calculations. Round your answers to two decimal places. Calculate: current yield. % annually yield to maturity, to the nearest basis point. % annually horizon yield (or realized return) for an investor with a two-year holding period and a reinvestment rate of 7% over the period. At the end of two...
Bonds of Francesca Corporation with a par value of $1000 sell for $980, mature in four...
Bonds of Francesca Corporation with a par value of $1000 sell for
$980, mature in four years, and have a 8% annual coupon rate period
semianually.
a) current yield ______ %annually
b) yield to maturity, to the nearest basis point ______
%annually
c) horizon yield (or realized return) for an investor with a
two-year holding period and a reinvestment rate of 6% over the
period. At the end 2 years, the 8% coupon bonds with 2 years
remaining will sell...
Bonds of Zello Corporation with a par value of $1,000 sell for $960, mature in five...
Bonds of Zello Corporation with a par value of $1,000 sell for $960, mature in five years, and have a 7% annual coupon rate paid semiannually. Compute the current yield and YTM. Hint: In what situation a bond can have current yield greater than YTM?
General Electric bonds have a par value of $1,000, sell for $1,070, mature in 6 years,...
General Electric bonds have a par value of $1,000, sell for $1,070, mature in 6 years, and have a 7% coupon rate paid annually. a. Calculate the current yield and yield to maturity for this bond. b. Calculate the realized compound yield for an investor with a 4-year horizon and a reinvestment rate of 5% over the period. At the end of the 4 years, assume that the coupon bonds will sell at a YTM of 6%. c. Explain why...
Kilroy Enterprises' bonds currently sell for $1,080. They have a 6-year maturity, an annual coupon of...
Kilroy Enterprises' bonds currently sell for $1,080. They have a 6-year maturity, an annual coupon of $75, and a par value of $1,000. What is their current yield? Your answer should be between 6.42 and 7.58, rounded to 2 decimal places, with no special characters.
5a FYI bonds have a par value of $1,000. The bonds pay an 8% annual coupon...
5a FYI bonds have a par value of $1,000. The bonds pay an 8% annual coupon and will mature in 11 years. i) Calculate the price if the yield to maturity on the bonds is 7%, 8% and 9%, respectively. ii) What is the current yield on these bonds if the YTM on the bonds is 7%, 8% and 9%, respectively. Hint, you can only calculate current yield after you have determined the intrinsic value (price) of the bonds. iii)...
Callaghan Motor’s bonds have 7 years remaining to maturity. Interest is paid annually, the bonds have a $1,000 par value, and the coupon interest rate is 5.5 percent. The bonds have a yield to maturit...
Callaghan Motor’s bonds have 7 years remaining to maturity. Interest is paid annually, the bonds have a $1,000 par value, and the coupon interest rate is 5.5 percent. The bonds have a yield to maturity of 8 percent. 1. What is the current market price of these bonds? 2. What is the current yield? 3. What is the capital gain/loss yield?
13. A company’s bonds have a $1,000 par value, and mature in 25 years. Their nominal...
13. A company’s bonds have a $1,000 par value, and mature in 25 years. Their nominal yield to maturity is 9.25%, they pay interest semiannually, and they sell at a price of $850. What is the bond’s nominal (annual) coupon rate?
YRK bonds currently sell for $870 and have a par value of $1,000. They pay a $50 annual coupon and have a 15-year maturi...
YRK bonds currently sell for $870 and have a par value of $1,000. They pay a $50 annual coupon and have a 15-year maturity, but they can be called in 5 years at $1,080. What is their yield to maturity (YTM)? Solve using financial calculator/which functions to use and what to plug in!
Bonds of Francesca Corporation with a par value of $1000 sell for
$980, mature in four years, and have a 8% annual coupon rate period
semianually.
a) current yield ______ %annually
b) yield to maturity, to the nearest basis point ______
%annually
c) horizon yield (or realized return) for an investor with a
two-year holding period and a reinvestment rate of 6% over the
period. At the end 2 years, the 8% coupon bonds with 2 years
remaining will sell...
Kilroy Enterprises' bonds currently sell for $1,080. They have a 6-year maturity, an annual coupon of $75, and a par value of $1,000. What is their current yield? Your answer should be between 6.42 and 7.58, rounded to 2 decimal places, with no special characters.
5a FYI bonds have a par value of $1,000. The bonds pay an 8% annual coupon and will mature in 11 years. i) Calculate the price if the yield to maturity on the bonds is 7%, 8% and 9%, respectively. ii) What is the current yield on these bonds if the YTM on the bonds is 7%, 8% and 9%, respectively. Hint, you can only calculate current yield after you have determined the intrinsic value (price) of the bonds. iii)...
Most questions answered within 3 hours.
-
An entomologist discovers a dung beetle rolling a ball of dung
along the ground, and decides...
asked 1 hour ago -
Humans have used horses for transportation for millions of
years. Therefore, they will use horses for...
asked 2 hours ago -
The following are the Jensen Corporation's unit costs of making
and selling an item at a...
asked 3 hours ago -
Does direct Medicare reimbursement of Advanced practice nurses
increase access to their services?
asked 4 hours ago -
List and explain why a company would choose to use a
published
compensation survey vs. creating...
asked 4 hours ago -
A discrete random variable X can take values from 1 to 10. Find
the variance of...
asked 4 hours ago -
The primary financial goal of a corporation is to maximize:
shareholders wealth.
earnings per share.
stock...
asked 4 hours ago -
determine whether the vectors u=(1,2,3,), v=(-2,1,0) and
w=(1,0,1) are linearly dependent or independent.
asked 4 hours ago -
python
Define a function called print_values which takes a dictionary
object as a parameter. The function...
asked 5 hours ago -
In Chapter 1 you created a program named Triangle in
which you displayed a seven-line triangle...
asked 5 hours ago -
Research question: What are the differences between separately
stated and non separately stated transactions in an...
asked 6 hours ago -
By using Arduino write a code that connects two LEDs to two
push-buttons. Each button controls...
asked 7 hours ago