Question

5) Suppose a 15-year, $1000 bond with an 8% coupon rate and semiannual coupons is trading for $1374.74.

a. What is the bond’s yield to maturity (expressed as an APR with semiannual compounding)?

b. If the bond’s yield to maturity changes to 4% APR, what will the bond’s price be?

Answer #1

Suppose a ten-year $1000 bond with an 8% coupon rate and
semiannual coupons is trading for $1034.74.
a. What is the bond's yield to maturity (expressed as an APR
with semiannual compounding)?
b. If the bond's yield to maturity changes to 9%APR, what will
be the bond's price?

Suppose a 10-year, $1,000 bond with an 8% coupon rate and
semiannual coupons is trading for $1,034.74.
A: What is the bond’s yield to maturity (expressed as an APR
with semiannual compounding)? Coupon? Number of periods? Yield to
Maturity?
B: If the bond’s yield to maturity changes to 9% APR, what will
the bond’s price be? Semi-annual yield? Bond Price?

Suppose a ten-year, $1000 bond with an 8.5% coupon rate and
semiannual coupons is trading for $1035.32
a. What is the bond's yield to maturity (expressed as an APR
with semiannual compounding)
b. If the bond's yield to maturity changes to 9.1% APR, what
will be the bond's price

Suppose a ten-year, $ 1000 bond with an 8.4 % coupon rate and
semiannual coupons is trading for $ 1035.35.
a. What is the bond's yield to maturity (expressed as an APR
with semiannual compounding)?
b. If the bond's yield to maturity changes to 9.5 % APR, what
will be the bond's price?

Suppose a ten-year, $ 1000 bond with an 8.5 % coupon rate and
semiannual coupons is trading for $ 1035.72
.
a. What is the bond's yield to maturity (expressed as an APR
with semiannual compounding)?
b. If the bond's yield to maturity changes to 9.3 % APR, what
will be the bond's price?

Suppose a 5-year bond with a 5% coupon rate, semiannual coupons
and a face value of $1000 has a yield to maturity of 8% APR.
What is the bond’s yield to maturity expressed as an effective
semi-annual rate? What is the bond’s yield to maturity expressed as
an effective annual rate (EAR)?
What is the price of the bond?
If the bond’s yield to maturity changes to 5% APR, what will the
bond’s price be?

Suppose a 10-year, $ 1,000 bond with a 10% coupon rate and
semiannual coupons is trading for a price of $1,177.98. a. What is
the bond's yield to maturity (expressed as an APR with
semiannual compounding)? b. If the bond's yield to maturity
changes to 8 %8% APR, what will the bond's price be?

Suppose a seven-year, $1000 bond with an 8% coupon rate and
semiannual coupons is trading with a yield
to maturity of 6.75%.
a.Is this bond currently trading at a discount, at par, or at a
premium? Explain.
Answer
___________________________________________________________
b.If the yield to maturity of the bond rises to 7.00% (APR with
semiannual compounding), what
price will the bond trade for?
Answer ______________________

Suppose a 10-year, $1,000 bond with a 11% coupon rate and
semiannual coupons is trading for a price of $945.47.
a. What is the bond's yield to maturity (expressed as an APR
with semiannual compounding)?
b. If the bond's yield to maturity changes to 10% APR, what
will the bond's price be?

Suppose a ten-year, $1,000 bond with an 8.5 % coupon rate and
semiannual coupons is trading for $1,035.81.
a. What is the bond's yield to maturity (expressed as an APR
with semiannual compounding)?
b. If the bond's yield to maturity changes to 9.2 % APR, what
will be the bond's price?

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