Question

you purchased s coupon bond at a price of 1059. the coupon rate for the bond is 5% with face value of 1000. you sold the bond at 1066.13 one year later. how much us one year holding period return on the bond ?

a-6%

b-5.39%

c-7%

d-6.26

e-8.52%

Answer #1

Answer is b. 5.39%

Return = (selling price- purchase price) + dividend

purchase price

= (1066.13- 1059) + 50

1059

= 0.05394712

= 5.39%

q1 - A coupon bond that pays interest semiannually has a par
value of $1,000, matures in 5 years, and has a yield to maturity of
6.5%. If the coupon rate is 3.5%, the intrinsic value of the bond
today will be
Q-2 you purchased s coupon bond at a price of 1059. the coupon
rate for the bond is 5% with a face value of 1000. you sold the
bond at 1066.13 one year later. how much us one...

You have just purchased a $1,000 bond with 7% annual coupon and
maturity in 10 years.
If the yield‐to‐maturity is 6%, how much did you pay for the
bond?
If, 1 year later and on the day after you receive the first
coupon, the bond’s yield‐to‐maturity goes up to 8%, and you need
cash and have to liquidate your investment. What will be your
selling price?
What will be your 1‐year holding period rate of return?

If a bond has face value $1000, annual coupon rate of 10% is
bought for $900 and sold 2 years later for $1100 what is holding
period return? Annualized return?

A. You buy a 10-year US Treasury Bond with a coupon interest
rate of 5% and Face Value of $1,000. You decide to sell your bond
four years later when market interest rates have fallen to 4%. Find
the selling price of the bond.
B. Calculate the Annualized Holding Period Return on the
investment. Show your work.

A. You buy a 10-year US Treasury Bond with a coupon interest
rate of 5% and Face Value of $1,000. You decide to sell your bond
four years later when market interest rates have fallen to 4%. Find
the selling price of the bond.
B. Calculate the Annualized Holding Period Return on the
investment. Show your work.

Suppose that you purchased a Baa rated $1000 annual coupon bond
with an 8.1% coupon rate and a 9-year maturity at par value. The
current rate on 9-year US treasuries is 3%. Two years
later, you look in the newspaper, and find that the yield on
comparable debt is 6.892%, how much is the bond currently
worth?

Suppose that you purchased a Baa rated $1000 annual coupon bond
with an 7.8% coupon rate and a 19-year maturity at par value. The
current rate on 19-year US treasuries is 3%. Two years later, you
look in the newspaper, and find that the yield on comparable debt
is 7.080%, how much is the bond currently worth?

1. A 3-year annual coupon bond has a yield to maturity of 8%,
coupon rate of 5%. The face value of the bond is $1,000.
a. What is the price of the bond? Is it premium bond or discount
bond?
b. Suppose one year later immediately after you receive the
first coupon payment, the yield to maturity drops to 7%. What would
be your holding period return if you decide to sell the bond at the
market price then?
c....

48. An investor purchased a $1000 face value bond for $925. The
bond has an 8 percent coupon rate, paid annually, and matures in
five years. The investor sold the bond one year later for $965,
while the price level was increasing at 5 percent. Calculate the
pre-tax real realized rate of return on the investment?
a. -.7%
b. 8%
c. 3%
d. 5%

A bond has a 10 percent coupon rate, makes annual payments,
matures in 12 years, and has a yield-to-maturity of 7 percent.
1. Given this: a. What is the price of the bond today? b. What
is the bond’s current yield? c. Based on the yield-to-maturity and
the current yield, what is the bond’s expected capital gains yield
over the next year?
2. One year from now the bond will have 11 years until maturity.
Assume market interest rates remain...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 4 minutes ago

asked 12 minutes ago

asked 23 minutes ago

asked 42 minutes ago

asked 52 minutes ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 2 hours ago

asked 2 hours ago

asked 2 hours ago

asked 2 hours ago