1. The following table gives the prices of US Treasury securities (pic 87445408). 2. Fill in the following table (1 point per correct entry to the nearest basis point, show all work) 3. Estimate the price and yield of a 2-year bond providing a semiannual coupon of 7% per annum. Face value ($) Time to maturity (years) Annual coupon ($) Bond price ($) 100 0.50 0.0 99 100 1.00 0.0 97 Scanned 100 h CamScar100r 1.50 4.0 100 CS 2.00 6.0 103

Assume coupons are paid annually. Here are the prices of three bonds with 10-year maturities. Assume face value is $100. Bond Coupon (%) 2 4 8 a. What is the yield to maturity of each bond? b. What is the duration of each bond? Price (%) 80.22 96.79 135.42 Complete this question by entering your answers in the tabs below. Required A Bond Coupon (%) 2 4 8 Required B What is the yield to maturity of each bond? Note: Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places. YTM % % %

The following table showing the cash flows for TIPS bonds. Inflation in Year Just Ended Time 0123 2.25% 5.00 3.50 Par Value $ 1,000.00 1,022.50 1,073.63 1,111.20 Coupon Payment + Principal Repayment = $ 46.01 $0 0 48.31 50.00 1,111.20 Required: a. What is the nominal rate of return on the bond in year 2? If real rate of return is 4.50% per annum b. What is the real rate of return in year 2? c. What is the nominal rate of return on the bond in year 3? d. What is the real rate of return in year 3? Total Payment $46.01 48.31 1,161.21

The following is a list of prices for zero-coupon bonds of various maturities. Maturity (years) 1 2 3 4 Price of Bond $ 980.90 914.97 843.12 771.76 Required: a. Calculate the yield to maturity for a bond with a maturity of (i) one year; (ii) two years; (iii) three years; (iv) four years. Assume annual coupon payments. b. Calculate the forward rate for (i) the second year; (ii) the third year; (iii) the fourth year. Assume annual coupon payments. Complete this question by entering your answers in the tabs below. Required A Required B Calculate the yield to maturity for a bond with a maturity of (i) one year; (ii) two years; (iii) three years; (iv) four years. Assume annual coupon payments. Note: Do not round intermediate calculations. Round your answers to 2 decimal places. Maturity (Years) Price of Bond YTM 1 $ 980.90 % 2 $ 914.97 % 3 $ 843.12 %

What is the price of the bond given the information below. The bond makes semiannual interest payments. (Do not round intermediate calculations, round answer to two decimals, i.e. 32.16)     Coupon Rate:8.5% YTM:9.5% Maturity (years):8 Par value: $2,000

You find the following Treasury bond quotes. To calculate the number of years until maturity, assume that it is currently May 2022. All of the bonds have a par value of $1,000 and pay semiannual coupons. Rate ?? 5.424 6.183 Maturity Month/Year May 32 May 35 May 41 Bid 103.4664 104.5004 ?? Asked Change 103.5392 +.3067 104.6461 ?? +.4341 +.5457 Ask Yield 6.079 ?? 4.111 In the above table, find the Treasury bond that matures In May 2035. What is your yield to maturity if you buy this bond? Note: Do not round Intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. Yield to maturity 96

The following data relate to a corporate bond which pays coupons semi-annually: Settlement date 01 March 2009 Maturity date 31 December 2035 Coupon rate 10% Yield to maturity 8% Face value $1,000 Percentage of face value paid back to the investor on maturity 100% Using the above data, calculate: i. The flat price of the bond ii. Accrued interest iii. Invoice price of the bond Note: Show the assumptions, if any, you made in your calculations.

Please see attached. Defintion: Coupon is the regular interest payment of a bond.

You are given the following information on two traded bonds making semi-annual coupon payments. Bond Face Value Coupon Maturity Price A $1,000 3% 12 years $850.10 B $1,000 10% 12 years $970.00 Calculate Yield to Maturity (YTM) for bonds A and B.

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