The following table lists several corporate bonds issued during a particular quarter. Bank of General Goldman Sachs Wells Company AT&T Verizon America Electric Fargo Time to Maturity (years) 10 10 Annual 240 3.00 5.25 5.15 5.15 2.50 Rate (%) Would Bank of America or Verizon pay the most total interest on a $4,000 bond at maturity? How much interest would that be? Bank of America would pay $ in interest on a $4,000 bond at maturity. Verizon would pay $ in interest ona $4,000 bond at maturity. Sa, we see (Verizon would pay the most interest on $4,000 bond at maturity.

The following table lists several corporate bonds issued during a particular quarter. Bank of General Goldman Sachs Wells Company AT&T Verizon America Electric Fargo Time to Maturity (years) 10 10 Annual 240 3.00 5.25 5.15 5.15 2.50 Rate (%) Would Bank of America or Verizon pay the most total interest on a $4,000 bond at maturity? How much interest would that be? Bank of America would pay $ in interest on a $4,000 bond at maturity. Verizon would pay $ in interest ona $4,000 bond at maturity. Sa, we see (Verizon would pay the most interest on $4,000 bond at maturity.

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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The following table lists several corporate bonds issued during the second quarter of 2015. Company AT&T Bank of America General Electric Goldman Sachs Time to Maturity (years) Annual Rate (%) 10 3.40 10 4.00 2 How much interest would you earn over the life of the bonds? $ 20400 X 5.25 3 MY NOTES 6.15 Verizon 8 5.15 ASK YOUR TEACHER Wells Fargo If you spent $30,000 on AT&T bonds, how much interest would you earn every 6 months? HINT [See Example 3.] $ 1020 X 3.50
Use a bankers year: 360 T-bills (Treasury bills) are one of the instruments the U.S. Treasury Department uses to finance public debt. If you buy a 200-day T-bill with a maturity value of $17,750 for $17,564.46, what annual simple interest rate will you earn? Express your answer as a percentage.
The following table lists several corporate bonds issued during a particular quarter. Company AT&T Bank ofAmerica GeneralElectric GoldmanSachs Verizon WellsFargo Time toMaturity(years) 10 10 2 3 8 7 AnnualRate (%) 2.40 5.00 5.25 7.15 4.15 3.50 If the General Electric bonds you purchased had paid you a total of $6,630 at maturity, how much did you originally invest? (Round your answer to the nearest dollar.)
The following table lists several corporate bonds issued during a particular quarter. Company AT&T Bank ofAmerica GeneralElectric GoldmanSachs Verizon WellsFargo Time toMaturity(years) 10 10 2 3 8 7 AnnualRate (%) 4.40 3.00 4.25 7.15 4.15 3.50 If the General Electric bonds you purchased had paid you a total of $8,680 at maturity, how much did you originally invest? (Round your answer to the nearest dollar.)
Determine the interest payment for the following three bonds. (Assume a $1,000 par value.) (Round your answers to 2 decimal places.) 3.55 percent coupon corporate bond (paid semiannually) 4.30 percent coupon Treasury note (paid semiannually) Corporate zero-coupon bond maturing in 10 years
(Bond relationship) Mason, Inc. has two bond issues outstanding, called Series A and Series B, both paying the same annual interest of $80. Series A has a maturity of 12 years, whereas Series B has a maturity of 1 year. a. What would be the value of each of these bonds when the going interest rate is (1) 6 percent, (2) 11 percent, and (3) 14 percent? Assume that there is only one more interest payment to be made on the Series B bonds. b. Why does the longer-term (12-year) bond fluctuate more when interest rates chavoe than does the shorter-term (1-vear) hond?
LOOP GAP Bank, Inc. ($000) ASSETS LIABILITIES/EQUITY ACCOUNT Treasury Bills $90 Time Deposits $1,100 Treasury Notes $55 Short-term borrowings $230 Treasury Bonds $176 Demand Deposits $2,500 Loans $4,679 Equity $1,170 Notes: All Treasury bills have three months until maturity (hint: what is the duration of a zero coupon instrument such as this three-month Treasury bill). The Treasury notes portion of The Loop GAP Bank securities portfolio consists of 2-year bonds paying an annual coupon of 8 percent and selling at par (hint: don’t worry about semi-annual compounding). Treasury bond portion of the securities portfolio has a duration of 4.5 years…
A bond issued by Ford on May 15, 1997 is scheduled to mature on May 15, 2097. If today is November 16, 2007, what is this bond’s time to maturity? (Use 365 days a year.) time to maturity _________________ years and _______________ months
1. Tel Corporation issued bonds at 2,500 par value. Given the interest rate of 8% in the market, how much interest is paid every year for 20 years where their bonds were sold at P4,000? 2. How much is the return in a one-year treasury bill at P2,550 with an annual interest rate of 2%?
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The following table lists several corporate bonds issued during the second quarter of 2015. Company AT&T Bank of America General Electric Goldman Sachs Verizon Wells Fargo Time to Maturity (years) 10 10 2 3 87 Annual Rate (%) 3.40 4.00 5.25 6.15 5.15 3.50 If you spent $20,000 on General Electric bonds, how much interest would you earn every 6 months? HINT [See Example 3.] $ 2100 Incorrect: Your answer is incorrect. How much interest would you earn over the life of the bonds? $ 25
The following table lists several corporate bonds. Treat these as zero coupon bonds, as in Example 2. Company AT&T LA Time to Maturity (years) 10 Annual Compound 2.97 Interest Rate (%) Bank of General Goldman America Electric Sachs 10 3.42 2 6.12 3 5.81 Verizon 8 5.41 Wells Fargo 7 4.18 If you bought AT&T bonds with a maturity value of $12,000, how much did you originally pay? (Round your answer to the nearest $1.)

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