Question

What is the price of a bond with the following features?

- Face Value = $1,000
- Coupon Rate = 2% (stated as an ANNUAL rate)
**Semiannual**coupon payments- Maturity = 5 years
- YTM = 4.8% (Stated as an APR)

State your answer to the nearest penny (e.g., 984.25)

Answer #1

Face/Par Value of bond = $1000

Semi-annual Coupon Bond = $1000*2%

= $10

No of Coupon payments(n) =No of years to maturity*2 = 5 years*2

= 10

Semi-annual YTM = 4.80%/2 = 2.40%

Calculating the Market price of Bond:-

Price = $87.975 + $788.8609

Price = $876.84

So,**the current market price of these bonds is
$876.84**

What is the price of a bond with the following features? Face
Value = $1,000 Coupon Rate = 4% (stated as an ANNUAL rate)
Semiannual coupon payments Maturity = 5 years YTM = 4.48% (Stated
as an APR) State your answer to the nearest penny (e.g.,
984.25)

What is the price of a bond with the following features?
Face Value = $1,000
Coupon Rate = 5% (stated as an ANNUAL rate)
Semiannual coupon
payments
Maturity = 9 years
YTM = 4.17% (Stated as an APR)
State your answer to the nearest penny (e.g., 984.25)

What is the price of a bond with the following features? Face
Value = $1,000 Coupon Rate = 7% (stated as an ANNUAL rate)
Semiannual coupon payments Maturity = 7 years YTM = 4.43% (Stated
as an APR) State your answer to the nearest penny (e.g.,
984.25)

1.What is the price of a bond with the following features?
Face Value = $1,000
Coupon Rate = 7% (stated as an ANNUAL rate)
Semiannual coupon payments
Maturity = 7 years
YTM = 6.34% (Stated as an APR)
State your answer to the nearest penny (e.g., 984.25)
2.
You own a bond with the following features:
Face value of $1000,
Coupon rate of 4% (annual)
11 years to maturity.
The bond is callable after 7 years with...

1.
What is the price of a bond with the following features?
Face Value = $1,000
Coupon Rate = 7% (stated as an ANNUAL rate)
Semiannual coupon payments
Maturity = 7 years
YTM = 6.34% (Stated as an APR)
State your answer to the nearest penny (e.g., 984.25)
2.
Assume you buy a bond with the following features
Bond maturity = 4
Coupon Rate = 5%
Face Value = $1,000
Annual Coupons
When you buy the bond the market interest rate...

A.
You own a bond with the following features:
Face value of $1000,
Coupon rate of 5% (annual)
11 years to maturity.
The bond is callable after 6 years with the call price of
$1,056.
If the market interest rate is 4.71% in 6 years when the bond
can be called, if the firm calls the bond, how much will it save or
lose by calling the bond?
State your answer to the nearest penny (e.g., 84.25)...

A.
You own a bond with the following features:
Face value of $1000, Coupon rate of 5% (annual) 8 years to
maturity. The bond is callable after 4 years with the call price of
$1,058.
If the market interest rate is 4.17% in 4 years when the bond
can be called, if the firm calls the bond, how much will it save or
lose by calling the bond? State your answer to the nearest penny
(e.g., 84.25). If there...

A.
Bond Features
Maturity (years) =
10
Face Value =
$1,000
Starting Interest Rate
4.98%
Coupon Rate =
4%
Coupon dates (Annual)
If interest rates change from 4.98% to 6.58% immediately after
you buy the bond today (and stay at the new interest rate), what is
the price effect in year 3 ?
State your answer to the nearest penny (e.g., 48.45)
If there is a loss, state your answer with a negative sign
(e.g., -52.30)
B.
Bond Features
Maturity...

1.
You own a bond with the following features:
Face value of $1000,
Coupon rate of 3% (annual)
12 years to maturity.
The bond is callable after 7 years with the call price of
$1,063.
If the market interest rate is 4.27% in 7 years when the bond
can be called, if the firm calls the bond, how much will it save or
lose by calling the bond?
State your answer to the nearest penny (e.g., 84.25)...

1. Maturity (years) = 5 Face Value = $1,000 Coupon Rate = 3.00%
Price = $900 Coupon (Annual)
What is the YTM (annual) of the above bond?
A 5.38%
B 5.30%
C 5.33%
D 4.80%
E 5.36%
2. Consider a bond with the following features: Maturity = 7
years Face value = $1,000 Coupon rate = 4% Semiannual coupons Price
= $993
What is this bond's YTM stated as an annual rate?
A 3.2500%
B 4.1161%
C 2.0581%
D 6.500%

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