Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Transcribed Image Text:A $50,000, 8% bond with semi-annual coupons is purchased three years before maturity. Calculate the discount or premium if the bond
is sold to yield 10.5% compounded semi-annually.
h
Select one:
a. $3,147.10
b. $2,735.58
c. $5,327.85
d. $2,537.85
O e. $4,237.85
10
Finis
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- ort A 16-year bond has a 10 percent annual coupon, a yield to maturity of 5 percent, and a face value of $1,000. What is the price of the bond? $1,511.89 $1,521.89 $1,531.89 $1,541.89 O $1.501.89arrow_forwardA 20-year maturity bond with par value of $1,000 makes semiannual coupon payments at a coupon rate of 12%. Find the bond equivalent and effective annual yield to maturity of the bond for the following bond prices. (Round your answers to 2 decimal places. Omit the "%" sign in your response.) Bond Bond Equivalent Annual Effective Annual Prices Yield to Maturity Yield to Maturity a. $ 950 % % b. $ 1,000 % % c. $ 1,050 % %arrow_forwardA bond with $898,000 face value that pays 10% coupon is issued at 102 1/2, i.e., 102.5% of its face value. Is this bond issues at premium of discount? And what is the amount of cash received as a result of issuing this bond? a. Premium; $920,450 b. Discount; $673,500 c. Premium; $987,800 d. PAR Value; $898,000 A B C Darrow_forward
- An investor with a bond of par value $1,000 paying 5% coupon semi-annually will receive ________. a. $100 annually b. $25 semi-annually c. $25 annually d. None of the above.arrow_forwardSally purchased a 5.73 percent coupon bond with a clean price of $1,031.83. What is the invoice price of the bond if there is four months to the next semiannual coupon date? A $1,012.73 B $1,022.28 C$1,041.38 D) $1,050.93 (E $1,089.13arrow_forwardThe Sisyphean Company has a bond outstanding with a face value of $1,000 that reaches maturity in 15 years. The bond certificate indicates that the stated coupon rate for this bond is 9.5% and that the coupon payments are to be made semannually.Assuming the appropriate YTM on the Sisyphean bond is 7.4%, then this bond will trede at A a premium. B. par c. a discount. D. none of the abovearrow_forward
- A 20-year, 10% monthly-pay bond has a par value of $1,000. If the price of the bond is $887.14, its yield-to-maturity (YTM) is closest to A. 11.44%. B. 12.29%. C. 14.92%. D. 35.05%.arrow_forwardInnovative Financial Inc. issues a bond with the following information: Par: $1,000 Time to maturity: 20 years Yield to maturity: 8 percent Current market price: $1,304.28 Quarterly payments What is the coupon rate? A. 10.12% B. 11.06% C. 14.38% D. 13.25%arrow_forwardGive typing answer with explanation and conclusion A $50,000, 8% bond with semi-annual coupons is purchased three years before maturity. Calculate the discount or premium if the bond is sold to yield 10.5% compounded semi-annually.arrow_forward
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