Question

A bond has a face value of $1000 with a time to maturity ten years from now. The yield to maturity of the bond now is 10%.

a) What is the price of the bond today, if it pays no coupons?

b) What is the price of the bond if it pays annual coupons of 8%?

c) What is the price today if pays 8% coupon rate semi-annually?

Answer #1

A corporate bond has a face value of $1000 with a maturity date
20 years from today. The bond pays interest semiannually at a rate
of 8% based on the face value (this means 8%/yr/semi). The interest
rate paid on similar corporate bonds has decreased to a current
rate of 6%/yr/semi (this would be i – the yield rate). What is the
market value of this bond, or what should an investor pay for the
bond?

a bond has a face value of $1000 and 14 years until maturity.
the bond has a 3% APR coupon with semi- annual coupon payments.
currently, investors seek a 6% APR yield to maturity to hold the
bond. what is the current trading price of the bond?

A bond with 10 years to maturity has a face value of $1,000. The
bond pays an 8 percent semiannual coupon, and the bond has a 5.9
percent nominal yield to maturity. What is the price of the bond
today?

What is the price of a $1000 face value zero-coupon bond with 4
years to maturity if the required return on these bonds is 3%?
Consider a bond with par value of $1000, 25 years left to
maturity, and a coupon rate of 6.4% paid annually. If the yield to
maturity on these bonds is 7.5%, what is the current bond
price?
One year ago, your firm issued 14-year bonds with a coupon rate
of 6.9%. The bonds make semiannual...

Your firm has a regular bond outstanding. The bond has a face
value of $1,000. The price or value of the bond today is $1,045.
The bond has 12 years to maturity. Coupons are paid semi-annually.
The coupon rate is 12.25%. What is the effective annual rate of
return?

A bond has a coupon ate of 10%, a 1000$ face value, matures in 5
years, has a yield of maturity of 15% percent and pays interest
annually. What is the current yield?

You buy a bond with the following features: 9 years to maturity,
face value of $1000, coupon rate of 3% (annual coupons) and yield
to maturity of 1.4%. Just after you purchase the bond, the yield to
maturity rises to 5%. What is the capital gain or loss on your
bond?

Consider a coupon bond that has a face value of $1000, has a
yield of 16%,
pays a semi annual coupon of 70, and matures in one year. Assuming
that the
bond will pay the face value amount that the cost coupon payment on
the
maturity date. Calculate the price of the bond.

Bond C has a $1,000 face value and provides an 8% coupon rate
for 15 years. The coupons are paid semi-annually. The discount rate
is 10% (annual rate). What is the value of the coupon bond?

bond has $1,000 face value, 25 years to maturity, 3.6% annual
coupon rate. The bond’s current price is $948.92. Assuming the bond
pays coupons semiannually, what is the bond’s yield to maturity
(YTM)?

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