Question

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)

If there would be a loss, state your answer as a negative (e.g., -37.51)

2.Use the bond term's below to answer the question

Maturity 6 years

Coupon Rate 4%

Face value $1,000

Annual Coupons

Market Interest Rate 6%

Assuming the YTM remains constant throughout the bond's life, what
is percentage capital gains/loss between periods 5 and 6 ?

Answer #1

Question 1)

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)...

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 2 years with the call price of $1,073. If the market
interest rate is 4.86% in 2 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 would be...

You own a bond with the following features: Face value of $1000,
Coupon rate of 4% (annual) 9 years to maturity. The bond is
callable after 1 years with the call price of $1,065. If the market
interest rate is 4.43% in 1 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 would be...

You own a bond with the following features: Face value of $1000,
Coupon rate of 4% (annual) 14 years to maturity. The bond is
callable after 3 years with the call price of $1,075. If the market
interest rate is 4.68% in 3 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 would be...

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...

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...

You own a bond with the following features:
Face value of $1000,
Coupon rate of 4% (annual)
14 years to maturity.The bond is callable after 3 years with the call price of
$1,059.If the market interest rate is 4.82% in 3 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 would be a loss, state your...

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.
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...

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)

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