Question

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?

Answer #1

_______________________________

_______________________________

**Value of Bond** **=
**

Where r is the discounting rate of a compounding period i.e. 6.892%

And n is the no of Compounding periods 7 years

Coupon 8.1%

=

= 1065.35

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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?

Suppose that you purchased a A rated $5000 annual coupon bond
with an 6.9% coupon rate and a 13-year maturity at par value. The
current rate on 13-year US treasuries is 3%. Two years later, you
look in the newspaper, and find that the yield on comparable debt
is 9.345%, how much is the bond currently worth?

A $5000 annual coupon bond with an 5.3% coupon rate and a
18-year maturity at par value. The current rate on 18-year US
treasuries is 3%. Two years later, you look in the
newspaper, and find that the yield on comparable debt is 7.152%,
how much is the bond currently worth?

Suppose that you just purchased a Baa rated $1000 annual coupon
bond with an 5.3 % coupon rate and a 4 -year maturity. If the yield
to maturity on the bond is 6.495 %, how much did you pay?

Suppose that you purchased a A rated $5,000 annual coupon bond
with an 6.7% coupon rate and a 11-year maturity at par value. The
current rate on 11-year US treasuries is 3%. Two years later, you
sell the bond, and for a yield of 7.922%, what was your capital
gain (+) or capital loss (-) in dollars and cents? (make your
answer positive for a gain, negative for a loss)

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with an 6.1% coupon rate and a 8-year maturity at par value. The
current rate on 8-year US treasuries is 3%. Two years later, you
sell the bond, and for a yield of 4.787%, what was your capital
gain (+) or capital loss (-) in dollars and cents? (make your
answer positive for a gain, negative for a loss)

A $5,000 annual coupon
bond with an 5.8% coupon rate and a 7-year maturity at par value.
The current rate on 7-year US treasuries is 3%. Two
years later, you sell the bond, and for a yield of 7.328%, what was
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Suppose, two years ago, you purchased a 10-year coupon bond
paying 4.5% interest annually with a face value of $1000. It is now
two years later and you just received an interest payment yesterday
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Group of answer choices
$1,017
$976
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none of them
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valuation) The 14-year $1000 face-value bonds
of Vail Ltd have a(n) 12%annual coupon rate. The market's
required yield to maturity on a comparable-risk bond is 9%.The
current market price for the bond is
$1090
a. Determine the yield to maturity.
b. What is the value of the bonds to you given
the yield to maturity on a comparable-risk bond?
c. Should you purchase the bond at the current
market price?
a. What is your yield to maturity on...

NHT, Inc. has $300 million of Baa-rated convertible bonds
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currently priced to yield 4.6%, decompose NHT’s convertible bonds
into their debt and equity components.

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