Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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A 10-year US Treasury bond with a face value of $1,000 pays a semi-annual coupon
of 6.6%. The reported yield to maturity is 4.3%. This yield is quoted as APRs with
semi-annual compounding. Please round your answers to two decimals.
b. Generate a graph showing how the bond’s
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- What is the yield to maturity for the following bond: current price is $908, coupon rate is 11 percent, $1,000 par value, interest paid semiannually, eight years to maturity?arrow_forwardA 3 - month zero - coupon bond is selling for $99.7 and a 10-year zero - coupon bond is selling for $52.9. Both bonds have a face value of $100. What's the 10-year - 3 - month spread in their yields? Answer in percent, rounded to one decimal place.arrow_forwardWhat is the expected capital gains yield for each bond in each year? Round your answers to two decimal places. See attached format Bond A has a 9% annual coupon, matures in 12 years, and has a $1,000 face value. Bond B has a 10% annual coupon, matures in 12 years, and has a $1,000 face value. Bond C has an 8% annual coupon, matures in 12 years, and has a $1,000 face value. Each bond has a yield to maturity of 9%.arrow_forward
- Use the method of averages to find the approximate yield rate for the bond with the following characteristics: Face value = $19,000 Bond rate payable semi-annually = 7% Time before redemption: 5 years Market quotation = 97.375 NOTE: The bond is to be redeemed at par.arrow_forwardA 6.05 percent coupon bond with 18 years left to maturity can be called in six years. The call premium is one year of coupon payments. It is offered for sale at $1,085.50. What is the yield to call of the bond? (Assume interest payments are semiannual.) (Round your answer to 2 decimal places.)arrow_forwardA 15-year maturity bond with par value $1,000 makes semiannual coupon payments at a coupon rate of 6%. Required: a. Find the bond equivalent and effective annual yield to maturity of the bond if the bond price is $940. (Round your intermediate calculations to 4 decimal places. Round your answers to 2 decimal places.) b. Find the bond equivalent and effective annual yield to maturity of the bond if the bond price is $1,000. (Do not round intermediate calculations. Round your answers to 2 decimal places.) c. Find the bond equivalent and effective annual yield to maturity of the bond if the bond price is $1,040. (Round your intermediate calculations to 4 decimal places. Round your answers to 2 decimal places.)arrow_forward
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