The one-year return on a 10-year coupon bond with face value of $10,000 and a 4% coupon rate that initially sells for par is nogu 1. All of the above bns Des 2. b)-3% if interest rates immediately rise from 4% to 5% after the bond is sold 3. c) 12% if interest rates immediately fall from 4% to 3% after the bond is sold 4. d) 4% if interest rates do not change 5. e) None of the above

For a 20-year $1000 par value 8% annual coupon bond that selling at a premium and makes semiannual coupon payments, what of the following is TRUE? O A. The YTM of this bond is below 8%. O B. The price of this bond is below its par value. O C. Because this bond is selling at a premium, it would be worth more than $1000 at maturity. O D. The bond pays $160 in interest every six months.

A 12% bond of Alpha Company with 15 year to maturity is selling in the market for $955, it has a $1,000 par value and pays interest annually. a. Calculate the both bond's yield to maturity (YTM).b. If your required rate of return is 12% would you buy this bond or not.b. Describe the relationship between the coupon rate and yield to maturity and market value of a bond.

Assume that you own a $1 million par value corporate bond that pays 7% in coupon interest (3.5% semiannual ), has 4 years remaining to maturity, and is immediately callable at par. Its current market yield is 7% and it is priced at par. If rates on comparable securities fall by more than 40 basis (0.2% semiannually), the bond will be called(a) Calculate the bonds price if the market rate increases by 50 basis  (0.25% semiannually) using the present value formula from(b) Calculate the bonds effective duration assuming a 50 basis - increase or decrease in market rates