The yield to maturity of a $1000 bond with a 6.8 % coupon rate, semiannual coupons, and two years to maturity is 8.9% APR, compounded semiannually. What is its price?
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- What is the market price of a redeemable (at par) bond, with a maturity date in 4 years’ time, and a coupon rate of 10%, if current cost of debt, Kd (return required or yield) is 8%?1. Consider a real return bond with a face value of $15,000 and a coupon yield of 5.2%. What is the coupon payment after one year if the inflation rate is 6.8%? Select one: a) $817.44 b) $833.04 c) $825.24 d) $809.64 IAssume the following yield to maturities: one year YTM 6%, two year YTM 7%, and three year YTM is 5%. A) What is today’s price of a three year zero coupon bond, 1000 par?
- What is the price of a bond with a coupon rate of 5.20% and semi-annual payments, if the yield-to-maturity is 10.20% and the bond matures in 20 years? Assume a par value of $1,000.Consider a bond with a coupon rate of 14% and coupons paid semiannually. The par value isS1000 and the bond has 7 years to maturity. The yield to maturity is 16%.Required:Find present values based on the payment periodHow many coupon payments are there?What is the semiannual coupon payment?What is the semiannual yield?What is the semi-annual coupon bond’s nominal yield to maturity (YTM), if the years to maturity is 15 years, and sells for 105% with coupons rate of 10%? Assume the par value of the bond is $1,000. Using a financial calculator
- A n-year annual coupons bond with coupon rate r per year. The yield rate is 0.10. Calculate the Macaulay duration of the bond for all four possible combinations of parameters: • n = 10 or 30 • r = 0.05 or 0.15Suppose that a 1-year zero-coupon bond with face value $100 currently sells at $90.44, while a 2-year zero sells at $82.64. You are considering the purchase of a 2-year-maturity bond making annual coupon payments. The face value of the bond is $100, and the coupon rate is 12% per year. Required: a. What is the yield to maturity of the 2-year zero? b. What is the yield to maturity of the 2-year coupon bond? c. What is the forward rate for the second year? d. If the expectations hypothesis is accepted, what are (1) the expected price of the coupon bond at the end of the first year and (2) the expected holding-period return on the coupon bond over the first year? e. Will the expected rate of return be higher or lower if you accept the liquidity preference hypothesis? Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Required E Will the expected rate of return be higher or lower if you accept the liquidity preference hypothesis?…Suppose that a 1-year zero-coupon bond with face value $100 currently sells at $89.75, while a 2-year zero sells at $79.88. You are considering the purchase of a 2-year-maturity bond making annual coupon payments. The face value of the bond is $100, and the coupon rate is 10% per year. Required: What is the yield to maturity of the 2-year zero? What is the yield to maturity of the 2-year coupon bond? What is the forward rate for the second year? If the expectations hypothesis is accepted, what are (1) the expected price of the coupon bond at the end of the first year and (2) the expected holding-period return on the coupon bond over the first year? Will the expected rate of return be higher or lower if you accept the liquidity preference hypothesis?
- Compute the yield to maturity on a bond with a $1000 par value, a coupon rate of 3.75% with semi-annual payments, and a 13-year maturity if the price is $804.21+U u=12Suppose that a 1-year zero-coupon bond with face value $100 currently sells at $94.34, while a 2-year zero sells at $84.99. You are considering the purchase of a 2-year-maturity bond making annual coupon payments. The face value of the bond is $100, and the coupon rate is 12% per year.a. What is the yield to maturity of the 2-year zero?b. What is the yield to maturity of the 2-year coupon bond?c. What is the forward rate for the second year?d. According to the expectations hypothesis, what are (i) the expected price of the coupon bond at the end of the first year and (ii) the expected holding-period return on the coupon bond over the first year?e. Will the expected rate of return be higher or lower if you accept the liquidity preference hypothesis?The function s(t) = 0.035 +0.003f gives the effective annual rate of a zero coupon bond of maturity t, with i in years. Find the price of a 2 year coupon bond with semiannual coupons of 7.5% and a face/redemption value of $700,000.