Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Consider a
10-year
bond with a face value of
$1,000
that has a coupon rate of
5.8%,
with semiannual payments.
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- Suppose a bond has a coupon rate of 9.5%, a remaining maturity of 15 years, and a face value of N1,000. If the yield-to-maturity on this bond is 13%, what is the current price (value) of this bond? The bond pays coupons monthly.arrow_forwardA two-year amortizing bond has a coupon rate of 4% and pays its coupons semi- annually. Coupon payments are based upon the outstanding face value at the start of the coupon period. It has a face value of £200 and £50 of the face value is amortized every half year. The yield to maturity is 1% per year. What is the price, duration and convexity of the bond?arrow_forwardCalculate the Macaulay duration of a three-year bond with K1000 face value and an annual coupon rate of 4% and current market of interest is 4%.arrow_forward
- Suppose a 6-year zero-coupon bond offers a payment of $1,800 and thecurrent market interest rate for this bond is 8%. What is the price of this bond?arrow_forwardA two-year amortizing bond has a coupon rate of 4% and pays its coupons semi- annually. Coupon payments are based upon the outstanding face value at the start of the coupon period. It has a face value of £200 and £50 of the face value is amortized every half year. The yield to maturity is 1% per year. What is the price of the bond?arrow_forwardA 5.25 percent coupon bond with 14 years left to maturity can be called in four years. The call premium is one year of coupon payments. It is offered for sale at $1,075.50. What is the yield to call of the bond? (Assume interest payments are semiannual.)arrow_forward
- A three-year bond is issued with a 9% coupon paid annually, and a maturity value of £100. If the current yield-to-maturity for three-year bonds is 12%, what is the issue price?arrow_forwardFind the value of a 15% coupon 3 year maturity bond, whose face value will be repaid at the end of the maturity.arrow_forwardAssume that you are considering the purchase of a 15-year, noncallable bond with an annual coupon rate of 7.55%. The bond has a face value of $1000, and it makes semiannual interest payments. If you require an 13.20% yield to maturity on this investment, what is the maximum price you should be willing to pay for the bond?Round your answer to two decimal placesarrow_forward
- Calculate the value of a $1,000 bond which has 10 years until maturity and pays annual interest at an annual coupon rate of 10 percent. The required return on similar-risk bonds is 12 percent.arrow_forwardCalculate the present value of a 15-year bond having the following parameters: face value: PLN 500; coupon rate (p.a.): 4%; coupon payable quarterly; YTM: 10%.arrow_forwardSuppose the redemption value of a 5-year bond is $105. It pays semiannual coupons of $3 each. The annual yield rate is 8% convertible semiannually. Calculate the interest earned on this bond for the first half year. Round the answer to the nearest tenth dollar.arrow_forward
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