Question

Consider three bonds with 6.70% coupon rates, all making annual coupon payments and all selling at face value. The short-term bond has a maturity of 4 years, the intermediate-term bond has a maturity of 8 years, and the long-term bond has a maturity of 30 years. a. What will be the price of the 4-year bond if its yield increases to 7.70%? (Do not round intermediate calculations. Round your answers to 2 decimal places.)

Answer #1

Consider three bonds with 6.70% coupon rates, all making annual
coupon payments and all selling at face value. The short-term bond
has a maturity of 4 years, the intermediate-term bond has a
maturity of 8 years, and the long-term bond has a maturity of 30
years.
e. What will be the price of the 8-year bond if its yield
decreases to 5.70%? (Do not round intermediate calculations. Round
your answers to 2 decimal places.)
f. What will be the price...

Find the duration of a 4% coupon bond making annual coupon
payments if it has 3 years until maturity and has a yield to
maturity of 4%. What is the duration if the yield to maturity is
6%? Note: The face value of the bond is $1,000. (Do not round
intermediate calculations. Round your answers to 3 decimal
places.)
Duration 4% YTM:
6% YTM:

Problem 7-5 Coupon Rates [LO2] Essary Enterprises has bonds on
the market making annual payments, with seven years to maturity, a
par value of $1,000, and selling for $974. At this price, the bonds
yield 7.2 percent. What must the coupon rate be on the bonds? (Do
not round intermediate calculations. Enter your answer as a percent
rounded to 2 decimal places, e.g., 32.16.) Coupon rate %

a. Find the duration of a 6% coupon bond making annual coupon
payments if it has three years until maturity and has a yield to
maturity of 6%. Note: The face value of the bond is $1,000. (Do not
round intermediate calculations. Round your answers to 3 decimal
places.) b. What is the duration if the yield to maturity is 10%?
Note: The face value of the bond is $1,000. (Do not round
intermediate calculations. Round your answers to 3...

Find the duration of a 8% coupon bond making annual
coupon payments if it has three years until maturity and a yield to
maturity of 7.8%. What is the duration if the yield to maturity is
11.8%? (Do not round intermediate calculations. Round your
answers to 4 decimal places.)
YTM
Duration
7.8% YTM

Find the duration of a 8% coupon bond making annual
coupon payments if it has three years until maturity and a yield to
maturity of 7.8%. What is the duration if the yield to maturity is
11.8%? (Do not round intermediate calculations. Round your
answers to 4 decimal places.)
YTM
Duration
7.8% YTM
11.8% YTM

Find the duration of a 6% coupon bond making annual coupon
payments if it has three years until maturity and a yield to
maturity of 7.7%. What is the duration if the yield to maturity is
11.7%? (Do not round intermediate calculations. Round your answers
to 4 decimal places.)
YTM Duration 7.7% YTM 11.7% YTM

Find the duration of a 4.0% coupon bond making
semiannually coupon payments if it has three years until
maturity and has a yield to maturity of 6.0%. What is the duration
if the yield to maturity is 8.0%? Note: The face value of the bond
is $100. (Do not round intermediate calculations. Round
your answers to 4 decimal places.)

Erna Corp. has 7 percent coupon bonds making annual payments
with a YTM of 6.2 percent. The current yield on these bonds is 6.55
percent.
How many years do these bonds have left until they mature?
(Do not round intermediate calculations and round your
answer to 2 decimal places, e.g., 32.16.)
Maturity of bond
years

A 4 year maturity bond making annual coupon payments with a
coupon of 8% has a duration of 3.607 years and a convexity of
16.08. The bond currently sells at a yield of 4%. What is the
actual price of the bond if the YTM immediately increases to 6%?
Round you answer to the nearest penny. Answer:

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