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 bond has a face value $1000, maturity of 10 years, and a
coupon rate of 8%, paid semi-annually. Assuming the
yield-to-maturity is 10%, the current price of the bond is:

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 amount of 1,000 and a term of n years. It is
bought to yield a nominal rate of 7% convertible semi-annually. The
bond will be redeemed for 1,100 at maturity. It pays semi-annual
coupons at 6% annual coupon rate. The present value of the coupon
is 426.50. What is the price of 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?

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?

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...

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)?

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?

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 8 minutes ago

asked 42 minutes ago

asked 44 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

asked 2 hours ago

asked 2 hours ago