Question

A 30-year bond matures in 7 years sells for $1,020, pays interest semiannually, and has a yield to maturity of 10.5883%. What is the bond’s current yield?

Answer #1

Current Yield | = | Annual Interest / Current Price | ||

= | $110 / $1,020 | |||

= | 10.7843% | |||

Current Price | = | $ 1,020 | ||

Face Value | = | $ 1,000 | ||

Yield to maturity | = | 10.5883% | ||

(Semiannual payments) [10.5883%/2] | = | 5.2942% | ||

Yield to maturity | = | [Interest payment + (Face Value - Current price)/2] / [(Face Value + Current price)/2] | ||

5.2942% | = | [Interest payment + (1,000 - 1,020)/2] / [((1,000 + 1,020)/2] | ||

Interest Payment | = | $ 55.00 | ||

Annual Interest payment | = | $55 X 2 | ||

= | $ 110 |

27. A 7 percent $1,000 bond matures in 4 years, pays interest
semiannually, and has a yield to maturity of 7.85 percent. What is
the current market price of the bond?

Problem 5-14
Current Yield with Semiannual Payments
A bond that matures in 7 years sells for $1,020. The bond has a
face value of $1,000 and a yield to maturity of 10.5883%. The bond
pays coupons semiannually. What is the bond's current yield? Do not
round intermediate calculations. Round your answer to two decimal
places.
%

A 6 percent $1,000 bond matures in 4 years, pays interest
semiannually, and has a yield to maturity of 6.85 percent. What is
the current market price of the bond?

A bond has a coupon rate of 3%, pays interest semiannually,
sells for $950, and matures in 3 years. Face value=1000
a) Calculate the approximate YTM (yield to maturity).
b) Calculate the YTM, using a financial calculator.
c) What is the difference between the approximate YTM and the
Real YTM in (b)?

XYZ Corporation’s $1,000 par value bond sells for $940, matures
in four years, and has a 7% coupon rate paid semiannually. What is
the bond’s yield to maturity? Show full working.
(Answer 8.81%)

A 10-year, 7 percent coupon bond pays interest semiannually. The
bond has a face value of $1,000. What is the percentage change in
the price of this bond if the market yield to maturity rises to 6
percent from the current rate of 5.5 percent?

Question 1
a. A bond that pays interest semiannually is selling for 100% of
its $1,000 par value. The bond has a 4% coupon rate and paid a
coupon 1 month ago. What is this bond's invoice price?
b.A bond has a $1,000 par value,10 years to maturity, a 4.5%
coupon, and currently sells for $1,037. The bond pays coupons
semiannually. The bond is callable 3 years from today with a call
price of $1,020. What is this bond's yield...

A callable bond with a $1,000 par value and a 7.5% coupon rate
pays interest semiannually. The bond matures in 20 years but is
callable in 5 years at a price of $1,100. Today, the bond sells for
$1,055.84. What is this bond’s yield to call expressed as a bond
equivalent yield?
3.49%
3.90%
6.18%
6.98%
7.80%

A bond has a coupon rate of 3%, pays interest every year, sells
for $1080, and matures in 3 years. What is its yield to maturity
(APR)?

A.Bond Prices A $1,000 par bond that pays
interest semiannually has a quoted coupon rate of 7%, a promised
yield to maturity of 7.7% and exactly 6 years to maturity. What is
the bond's current value?
B.Bond Prices A $1,000 par bond that pays
interest semiannually has a quoted coupon rate of 5%, a promised
yield to maturity of 5.7% and exactly 11 years to maturity. The
present value of the coupon stream represents ______ of the total
bond's value....

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