A $9,000 bond matures in 10 years and pays 2 percent interest twice a year. If the bond sold for $7,000, what is the annual actual investment rate?   a.  IRR = 7.15%%   b.  IRR = 5.10%   c.  IRR = 3.58%   d.  IRR = 6.23%

Q: The market price is $800 a 17-year bond ($1,000 par value) that pays 9 percent annual interest, but…

A: In the given question we need to compute the bond's yield to maturity using following details :…

Q: how much will the bond value increase over the next three years?

A: Answer Given N = 20, PMT =1000*5%= 50, FV = 1000, I/Y = 6.5%, CPT PV = -834.72.

Q: A $1,000 principal value bond costs $35 in quarterly interest and matures in ten years. How much…

A: 71c. $1,115.57

Q: ACT has an outstanding bond with a face value ( principal) of 1,000which would mature in 10 years.…

A: Current market value = present value of all future cash flows   Here FV = 1000; nper (or time…

Q: A bond has 5 years to its maturity .It was purchased for 50,000 TL and had a return 12% per year…

A: Computation of present worth of bond based on the yield:Coupon rate=50000Return=12% per annum…

Q: A $5,000 bond with a bond rate of 5% payable semi-annually was purchased for $4,500, kept for 10…

A: The above answer can be explained as under - Here, the excel has been used to calculate yield to…

Q: A $3,500,000 issue of a 30-year bond, redeemable at par, offers 9.00% coupons payable semi-annually.…

A: The question is based on the concept of Financial Accounting.

Q: How much will the coupon payments be of a 25 year $5,000 bond with a 8% coupon rate and semi annual…

A: We require to calculate the coupon payment from following details : Face value of bonds = $5000…

Q: An investor purchases a bond 6 months after the issue. The bond will be redeemed at 105% eight years…

A: Price of a bond = present value of its future cashflows, let the purchase price be = P  Hence, P =…

Q: An investor purchases a 10-year, $5,000 face value bond that pays semiannual interest at annual rate…

A: Detailed explanation:1. Semiannual Coupon Rate Calculation:Semiannual Coupon Rate=210%​=5% 2. Coupon…

Q: A $8500 bond bearing interest at 4.3% payable semi-annually is due in 7 years. Money is worth 5.9%…

A: Par value = $8500 Coupon rate = 4.3% Frequency of payment  = Semi annual

Q: A $350,000 face value bond having a bond rate of 7% nominal payable semi-annually is purchased for…

A: The selling price of the bond should be such that it earns the required rate of return over the bond…

Q: Calculate the present value of an $80,000, 10%, five- year bond that pays $8,000 ($80,000 × 10%)…

A: Given details are : Par value of bond = $80000 Coupon on bond = $8000 Market rate of interest = 10%…

Q: What is the coupon payment of a 15 -year $10,000 bond with a 9 % coupon rate with semiannual…

A: Given details are : Face value of bonds =$10000 Time period = 15 years  Coupon rate = 9% Coupon…

Q: 1. A bond maturing in 10 years pays annual coupon payment $80 each year and $1,000 upon maturity.…

A: Solution:- Present value of bond means the current price of bond at which it is trading in the…

Q: How much will the coupon payments be of a 15-year $500 bond with a 9% coupon rate and quarterly…

A: To calculate the coupon payment amount we will use the below formula   Coupon amount = FV*(C/M)…

Q: A P 250 000, 14% bond pays dividend semi-annually for 12 years. The bond is redeemable at par. If…

A: Here we need to compute the YTM of this bond given the details. We can do so by using the "RATE"…

Q: A bond with a face value of $2,000 pays half-yearly interest at a rate of 8% pa compounded…

A: Bond compounding semi-annually: In this case, the bond has a face value of $ 2000 that pays…

Q: What is the present worth of a $10000 bond that has an interest of 20% per year payable…

A: The bond is fixed-income security issued by the company to raise funds. The present worth of a bond…

Q: A $3000 bond that pays 9%semi-annually is redeemable at par in 15 years. Calculate the purchase…

A: Solution:- We know, the purchase price of bond is the present value of amounts receivable from the…

Q: A 9-year bond pays interest of $26.20 semiannually, has a face value of $1000, and is selling for…

A: B0 = Interest * PVCF @ YTM for 18 periods + Maturity Value * PVF @ YTM for 18th period

Q: A bond with a face value of P1,500,000 is sold at P1,400,000. If the bond matures in 5 years and…

A: Step 1 Bond valuation: It is the cycle to determine the fair value of a bond or present value of a…

Q: If a $1,000 par value bond pays a 4% coupon each year, paid semi-annually, how much would each…

A: Coupon payments are paid to the bondholders by the issuer of the bond.

Q: The market price is $1,150 for a 9​-year bond ​($1,000 par​ value) that pays 12 percent annual​…

A: Bonds are debt instruments issued by companies. Yield to maturity is the total rate of return that…

Q: 0-year 8% annual coupon bond with a face value of 1000 is purchased. At the time of purchase, the…

A: Price of bond is the present value of coupon payments plus present value of par value of the bond…

Q: A five year bond pays interest $85 once a year and will mature for $1000. YTM is 10%. Determine the…

A: Macaulay Duration Formula: Macaulay Duration (MD) = (C1*t1 + C2*t2 + ... + Cn*tn) / (PV + FV) /…

Q: Calculate the durations and volatilities of securities A, B, and C. The interest rate is 8%,…

A: The objective of this question is to calculate the durations and volatilities of three different…

Q: One hundred $1,000 bonds having bond rates of 8% per year payable annually are available for…

A: Bond valuation is done through the concepts of present value. The value of the bond is the present…

Q: Investment in a Bond You invest in a 10-year $10,000 bond that pays interest at an annual rate 7%…

A: The bonds are the debt securities issued by the corporation or a government entity. The bonds are…

Q: A $3000, 7.5% bond (payable semi-annually) is redeemable at par in 2 years and 6 months. If the bond…

A: Par Value or Face Value (P) – This is the actual money that is being borrowed by the lender or…

Q: A ten-year USD100 par value bond pays 8% coupons semiannually. The bond is priced at USD118.20 to…

A: Bond value is the current price or the present value of the bond. This can be determined by…

Q: What is the present value of a 10-year bond outstanding with 8 years left in “year-to-maturity,” 6%…

A: A bond is a useful tool for finance concepts. Bond market values are used by analysts and investors…

Q: A 50,000$ bond has a maturity date of 6 years. the bond interest rate is 6% per annum payable…

A: Bonds are the liabilities of the company which is issued to raise the funds required to finance the…

Q: lease provide whole answer: A company has a bond outstanding. Bond A has a face value of $20,000…

A: The bond is a debt instrument that is issued by the organization to raise the funds from the bond…

Q: A 14-year, $1,000 par value Fingen bond pays 6% interest annually (assume semi- annual payments).…

A: Bond price refers to the current market value of a bond, which is determined by the present value of…

Q: d purchase price of a 7%, m=2, Php 15,000 bond

A: The given problem can be solved using PV function in excel. PV function computes current price  for…

Q: A $5000 bond bearing interest at 3.4% payable semi-annually is due in 12 years. Money is worth 8.0%…

A: Coupon rate is the rate that provides the amount of payment to be made to the holder at the…

Q: 52,000 is invested in a 5-year fixed interest bond paying 5.5% per year. If interest is reinvested…

A: Bond is a debt security which is issued by the organizations to raise funds. The investment in bonds…

Bond Valuation

Bond valuation are the notes issued by the corporation to raise long-term funds for the business. The corporations are required to pay the interest on such liabilities at a specified rate of interest (termed as coupon rate) at specified dates which may be on semi-annual or annual basis. These interest payments may be in the form of coupons.