An investor invested a one-year maturity zero coupon rate bond 60days ago by paying 965 USD from primary market. The bond is traded in the market with % 3 interest rate today. Ifthe bond's face value is $1,000 and yearis accepted as a360 days. If the investor sells the bond today, what will behis/her return from this investment.?
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An investor invested a one-year maturity zero coupon rate bond 60days ago by paying 965 USD from primary market. The bond is traded in the market with % 3 interest rate today. Ifthe bond's face value is $1,000 and yearis accepted as a360 days. If the investor sells the bond today, what will behis/her return from this investment.?
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- Suppose a 10-year, 10% semiannual coupon bond with a par value of 1,000 is currently selling for 1,135.90, producing a nominal yield to maturity of 8%. However, the bond can be called after 5 years for a price of 1,050. (1) What is the bonds nominal yield to call (YTC)? (2) If you bought this bond, do you think you would be more likely to earn the YTM or the YTC? Why?An investor invested a one-year maturity zero coupon rate bond 90 days ago by paying 965 USD from primary market. The bond is traded in the market with % 3 interest rate today. Ifthe bond's face value is $1,000 and yearis accepted as a 360 days. If the investor sells the bond today, what will behis/her return from this investment.?An investor invested a one-year maturity zero coupon rate bond 60 days ago by paying 965 USD from primary market. The bond is traded in the market with %3 interest rate today. If the bond's face value is $1,000 and year is accepted as a 360 days. If the investor sells the bond today, what will be his/her return from this investment. i want answers using this fourmla
- An investor invested a one-year maturity zero coupon rate bond 60 days ago by paying 965 USD from primary market. The bond is traded in the market with %3 interest rate today. If the bond's face value is $1,000 and year is accepted as a 360 days. If the investor sells the bond today, what will be his/her return from this investment.A firm issues a bond today with a $1,000 face value, an 8% coupon interest rate, and a 25-year maturity. An investory purchases the bond for $1,000. 1. What is the yeild to maturity? 2. Suppose the investor bouht the bond described previously for $900. What is the YTM? 3. Suppose the bond described previously has a price of $1,100 five years after it is issued. What is the YTM at the time?Suppose you purchase a 30-year Treasury bond with a 6% annual coupon, initially trading at par. In 10 years’ time, the bond’s yield to maturity has risen to 7% (EAR).a. If you sell the bond now, what internal rate of return will you have earned on your investment in the bond?b. If instead you hold the bond to maturity, what internal rate of return will you earn on your investment in the bond?c. Is comparing the IRRs a useful way to evaluate the decision to sell the bond?
- Suppose you buy a bond with a coupon of 8.2 percent today for $1,100. The bond has 7 years to maturity. Assume interest payments are reinvested at the original YTM. a. What rate of return do you expect to earn on your investment? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Rate of return % b. Two years from now, the YTM on your bond has increased by 2 percent, and you decide to sell. What price will your bond sell for? Note: Do not round intermediate calculations. Round your answer to 2 decimal places. PriceYour client is considering the purchase of a bond that is currently selling for $1058.15. The client wants to know what annual rate of return can they expect to earn on the bond. The bond has 27 years to maturity, pays a coupon rate of 7.8% (payments made semi-annually), and a face value of $1000, (Round to 100th of a percent and enter your answer as a percentage, e.g. 12.34 for 12.34%) Answer: CheckYou purchased a coupon-bearing bond at $800 and resold it at $900 after exactly one year. If the coupon is $60 paid annually, what is the current yield of the bond? O A. 0.075 O B. 0.125 O C. 0.067 O D. 0.200
- You purchased a coupon-bearing bond at $1000 and resold it at $1200 after exactly one year. If the coupon is $60 paid annually, what is the current yield of the bond? OA 0.060 O B. 0.050 OC. 0.200 O D. 0.26Suppose you purchase a zero coupon bond with a face value of 10,000 maturing in 10 years, for $3,700. Zero coupon bonds pay the investor the face value on the maturity date. What is the implied dollar interest you would earn in the first year of the bond’s life? Select one: $370.00 $380.00 $386.78 $1,000.00 $256.72Suppose you buy a bond with a coupon of 6.6 percent today for $1,110. The bond has 7 years to maturity. Assume interest payments are reinvested at the original YTM a. What rate of return do you expect to earn on your investment? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Rate of return b. Two years from now, the YTM on your bond has increased by 2 percent, and you decide to sell. What price will your bond sell for? |(Do not round intermediate calculations. Round your answer to 2 decimal places.) Price