Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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- A bond has a coupon rate of 9.2 percent and 5 years until maturity. If the yield to maturity is 9.3 percent, what is the price of the bond? (Do not round intermediate calculations. Round your answer to 2 decimal places.)arrow_forwardSuppose a seven-year, $1,000 bond with a 5.98% coupon rate and semiannual coupons is trading with a yield to maturity of 4.01%. a. Is this bond currently trading at a discount, at par, or at a premuim? Explain. b. If the yield to maturity of the bond rises to 4.37% (APR with semiannual compounding), at what price will the bond trade?arrow_forwardUsing the formula given below: Rbonds = F - P P if the market price of a $1,000-face-value discount bond changes from $925 to $900, the yield to maturity increases by%. (Round your response to two decimal places.)arrow_forward
- Consider the following bonds: •Bond A: A 2-year zero-coupon bond with a face value of $100 and 6% YTM. •Bond B: A 2-year par-value bond with a face value of $100 and 6% coupon rate. *Bond C: A 2-year par-value bond with a face value of $100 and 7% coupon rate. Suppose the yield curve shifts upwards by one percent. Which bond among bonds A, B, and C will experience the largest percentage price change? Which will have the lowest percentage price change? O a. Bond A; Bond C O b. Bond A; Bond B O c. Bond B; Bond C O d. Bond C; Bond Barrow_forwardYou purchase a bond with an invoice price of $1,047. The bond has a coupon rate of 10 percent, and there are 4 months to the next semiannual coupon date. What is the clean price of the bond? Enter the answer with 2 decimals (e.g. 954.23).arrow_forwardA $1,000 par value bond has a current price of $801.36 and a maturity value of $1,000 and matures in 5 years. If interest is paid semiannually and the bond is priced to yield 8%, what is the bond's annual coupon rate? The bond's annual coupon rate is%. (Round to three decimal places.)arrow_forward
- K← Consider the case of a two-year discount bond-that is, a bond that pays no coupon and pays its face value after two years rather than one year. Suppose the face value of the bond is $1,000, and the price is $850. What is the bond's yield to maturity? The bond's yield to maturity is%. (Round your response to two decimal places.)arrow_forwardA bond's semi-annual coupon is $52.9. What is the coupon rate?arrow_forward2. A bond with par value $1,000 has a current yield of 7% and a coupon rate of 8%. What is the bond's price if it pays interest annually?(Round your answer to the nearest cent.)arrow_forward
- K Suppose a five-year, $1,000 bond with annual coupons has a price of $895.56 and a yield to maturity of 6.4%. What is the bond's coupon rate? *** The bond's coupon rate is %. (Round to three decimal places.)arrow_forwardThe following table shows some data for three bonds. In each case, the bond has a coupon of zero. The face value of each bond is $1,000. Bond Price Maturity (Years) Yield to Maturity A $ 230 20 B с 230 17 10% 9 What is the yield to maturity of bond A? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 3 decimal places. Assume annual compounding. What is the maturity of B? Note: Do not round intermediate calculations. Round your answer to 2 decimal places. Assume annual compounding. What is the price of C? Note: Do not round intermediate calculations. Round your answer to 2 decimal places. Assume annual compounding.arrow_forwardSuppose a 10-year, $1,000 bond with a coupon rate of 8.7% and semiannual coupons is trading for $ 1,034.28 a. What is the bond's yield to maturity (expressed as an APR with semiannual compounding)? b If the bond's yield to maturity changes to 9.9% APRwhat will be the bond's price?arrow_forward
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