A Treasury Bond with $1,000 par value and 6 years to maturity pays a 6% semi-annual coupon. The YTM is 8%, APR semi-annual compounding. A coupon has just been paid. A futures contract expiring in 15 months calls for delivery of this bond only. The risk-free rate is 5% EAR. Calculate the futures price.
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A Treasury Bond with $1,000 par value and 6 years to maturity pays a 6% semi-annual coupon. The YTM is 8%, APR semi-annual compounding. A coupon has just been paid. A futures contract expiring in 15 months calls for delivery of this bond only. The risk-free rate is 5% EAR. Calculate the futures price.
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- A bond has 10 years until maturity, a coupon rate of 9%, and sells for $1,100. Interest is paid annually. (Assume a face value of $1,000.) If the bond has a yield to maturity of 9% 1 year from now, what will its price be at that time? Note: Do not round intermediate calculations. What will be the rate of return on the bond? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Negative amount should be indicated by a minus sign. If the inflation rate during the year is 3%, what is the real rate of return on the bond? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Negative amount should be indicated by a minus sign.You can enter into a forward contract for a bond with a maturity in one year months that pays a coupon payment of $25 every six months. The bond has a forward price of $930. The current zero coupon rate for 6 months is 4% annually and the zero coupon risk free rate for one year is 5% annually (assume continuous compounding). The current price of the bond is $943. Use the equilibrium forward price equation (F=Sert) adjusted for both coupon payments to see if an arbitrage opportunity exists. If arbitrage is possible, explain the arbitrage opportunity that exists and show how the profit can be earned – make sure to explain every step in detail in realizing the profit and establishing the arbitrage. If arbitrage is not possible, show how you know it is not possible. ANSWER IN TYPING OTHER WISE DOWNVOTE YOUA bond has 10 years until maturity, a coupon rate of 8.3%, and sells for $1,170. Interest is paid annually. ( Assume a face value of $1,000.) If the bond has a yield to maturity of 9.7% 1 year from now, what will its price be at that time? Note: Do not round intermediate calculations. Round your answer to nearest whole number. What will be the rate of return on the bond? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Negative amount should be indicated by a minus sign. If the inflation rate during the year is 3%, what is the real rate of return on the bond? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Negative amount should be indicated by a minus sign.
- A bond has 10 years until maturity, a coupon rate of 8.4%, and sells for $1,160. Interest is paid annually. (Assume a face value of $1,000.) If the bond has a yield to maturity of 9.6% 1 year from now, what will its price be at that time? Note: Do not round intermediate calculations. Round your answer to nearest whole number. What will be the rate of return on the bond? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Negative amount should be indicated by a minus sign. If the inflation rate during the year is 3%, what is the real rateA bond has 10 years until maturity, a coupon rate of 8.1%, and sells for $1,190. Interest is paid annually. (Assume a face value of $1,000.) a. If the bond has a yield to maturity of 9.9% 1 year from now, what will its price be at that time? Note: Do not round intermediate calculations. Round your answer to nearest whole number. Price b. What will be the rate of return on the bond? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Negative amount should be indicated by a minus sign. Rate of return % c. If the inflation rate during the year is 3%, what is the real rate of return on the bond? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Negative amount should be indicated by a minus sign. Real rate of return %A 10-year bond with a face value of $1,000 has a coupon rate of 9.0%, with semiannual payments. a. What is the coupon payment for this bond? b. Enter the cash flows for the bond on a timeline. a. What is the coupon payment for this bond? The coupon payment for this bond is $ every six months. (Round to the nearest cent.)
- The bond has a coupon rate of 6.77 percentit makes semiannual payments, and there are 5 months to the next coupon payment. A clean price of $1,043 and the par value is $1,000What is the invoice price?Consider a Treasury bond with 8% coupon rate and 4 years to maturity (annual coupons). You enter into a forward contract to purchase this bond two years from today right after the second coupon is paid. What is the forward price? The prices of zero coupon bonds maturing in one, two, three, and four years (per 1$ face value) are 0.9524, 0.8900, 0.8278, and 0.7629 respectively.Suppose that a 20-year bond with a coupon rate of 12% is selling at its par value of $100,000. Also suppose that this bond is the deliverable for a futures contract that settles in three months, and the current 3-month interest rate at which funds can be loaned or borrowed is 8% per year. The seller elects to deliver a Treasury bond issue with a conversion factor of 1.20. Also assume that the accrued interest is 7. What is the invoice price that the buyer pays? O $124,600 $125,800 $126,300 $127,100
- The yield to maturity on 1-year zero-coupon bonds is currently 7%; the YTM on 2-year zeros is 8%. The Treasury plans to issue a 2-year maturity coupon bond, paying coupons once per year with a coupon rate of 9%. The face value of the bond is $100. At what price will the bond sell? What will the yield to maturity on the bond be?A bond with a face value of $1,000 has 10 years until maturity, carries a coupon rate of 9%, and sells for $1,100. Interest is paid annually. Assume a face value of $1,000 and annual coupon payments.a) If the bond has a yield to maturity of 9% 1 year from now, what will its price be at that time?b) What will be the rate of return on the bond? c) If the inflation rate during the year is 3%, what is the real rate of return on the bond? Assume annual interest payments.The duration of a 20-year, 8 percent coupon Treasury bond selling at par is 10.34 years. The bond’s interest is paid semiannually, and the bond qualifies for delivery against the Treasury bond futures contract. What is the modified duration of this bond? What is the impact on the Treasury bond price if market interest rates increase 50 bps?