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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%?What is the fair price for a bond with a 5.5% annual coupon and 8 years until maturity if the yield is 9%?Consider a bond with a 10% coupon and yield to maturity = 8%. If the bond’s yield to maturity remains constant, then in one year, will the bond price be higher, lower, or unchanged? Why?
- You are looking at a 18-year zero-coupon bond that has a yield to maturity of 5.0% . What is the value of the bond? Assume semi-annual compounding. leWhat 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.What is the Macaulay duration of a semi-annual bond with a coupon rate of 7 percent, five years to maturity, and a current price of $959? What is the modified duration? Duration is __. years. Modified duration is __ years.
- Consider a 30-year bond with a 10% coupon rate (annual payments) and a $100 face va the initial price of this bond if it has a 5% yield to maturity? If the yield to maturity is un will the price be immediately before and after the first coupon is paid?What is the duration of the following bond:$1,000par value,6%annual coupon, 4 years to maturity, and yield to maturity of6.5%? You will need your answer for the next question. In the prior question, what is the present value of the bond?What should the current market price be for a bond with a $1,000 face value, a 10% coupon rate paid annually, a required rate of return of 12%, and 20 years until maturity?
- What is the value of a 6%, five year bond with annual coupons and face value equal to $1,000, if the current yield to maturity is 6%?How is a bond’s value determined? What is the value of a 10-year, $1,000 par value bond with a 10% annual coupon if its required return is 10%?A bond with 5 years to maturity, a face value of $2,000 and a coupon rate of 8.0% is selling for $1750. What is its yield to maturity? If the yield changes to 8.0%, what will be the new price of the bond? (Assume annual coupon payments.)