A $100 bond with 6% annual coupons that can be called on any coupon date10 years to 20 years from now, what price should an investor pay to get a minimum yield rate eof 8% effective? If this price is paid, what is the maximum yield rate the investor can earn? 10.
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- A zera coupon bond with promised payment of $100 to be paid in 5 years has price equal to$80. What is the YTM?A one-year zero coupon bond costs $99.43 today. Exactly one year from today, it will pay $100. What is the annual yield-to-maturity of the bond? (1.e., what is the discount rate one needs to use to get the price of the bond given the future cash flow of $100 in one year?) 1.0057 0.0057 2.0057 -0.0057Dog Suppose you purchase a 10-year bond with 6.6% annual coupons. You hold the bond for four years, and sell it immediately after receiving the fourth coupon. If the bond's yield to maturity was 5.4% when you purchased and sold the bond, a. what cash flows will you pay and receive from your investment in the bond per $100 face value? b. what is the annual rate of return of your investment?
- Suppose you considering buying a 10-year bond. This bond will pay you 1603 taka every year for the next 10 years. Interest rate during this 10-year period is expected to remain constant at 5.6%. What is the maximum taka amount that you are willing to pay for this bond today? Please Asap!What is the value to you of a 9 percent coupon bond with a par value of $10,000 that matures in 10 years if you want a 7 percent return? What if you want an 11 percent rate of return? Use semiannual compounding.Suppose that all investors expect that interest rates for the 4 years will be as follows: Year 0 4% (today) Year 1 5% Year 2 6% Year 3 7% What is the price of a 2-year maturity bond with a 10% coupon rate paid annually? (Par value =1,000).
- What should the current market price be for a bond with a $1,000 face value, a 10% coupon rate paid annually, a required rate of return of 8%, and 20 years until maturity? What generalizations about bond prices can you make given your answers to #1 and #2? A bond has a market price of $1,000, a $1,000 face value, a 10% coupon rate paid annually, a required rate of return of 10%, and 30 years until maturity. If the required rate of return immediately increased to 13%, what is the new market price of the bond? A bond has a market price of $1,000, a $1,000 face value, a 10% coupon rate paid annually, a required rate of return of 10%, and 10 years until maturity. If the required rate of return immediately increased to 13%, what is the new market price of the bond? What generalizations about bond prices can you make given your answers to #4 and #5? The CFO of Brady Corp. announces that the firm plans to grow its annual dividend at a rate of 3% forever. The company just paid its annual…What's the value to you of a $1,000 face-value bond with an 10% annual coupon rate and 6years to maturity when your required rate of return is 10 percent?What should the current market price be for a bond with a $1,000 face value, a 10% coupon rate paid annually, a required rate of return of 12%, and 20 years until maturity?
- You purchase a 3-year coupon bond at the par value today. The information of this coupon bond is shown below: annual coupon rate: 10% face value: $1,000 What is the YTM of this bond today? Suppose the annual reinvestment rate is 8% for the next two years. What is the realized compound yield if you sell this bond at the end of year 2? O a. 10 % ; 10.75% O b. 10%; 10% O c. 10.75%; 10.75% O d. 8%; 9% kFor all problems assume that the interest rate is 12% •What is the future value in year 11 of an annuity which pays $10,000 per year beginning in year one and ending in year 11? •What is the yield of a bond whose current price is $1,049 with a coupon rate of 6% and a maturity of 12 years?What price would you pay for a 10-year, AA bond with a Face Value of $1,000 and a coupon rate of 7.10%?
